Copper mine supply risks first decline since 2017: Sprott
Sprott Asset Management reports global mined copper production may fall in 2026, the first decline since 2017, due to disruptions, declining grades, and weak Chilean output. Disruptions at Freeport-McMoRan's Grasberg mine and Ivanhoe Mines' Kamoa-Kakula complex removed 600,000 tonnes of expected production. Chile's output fell 6.6% in the first half of 2026, with Codelco, Antofagasta, and Lundin Mining cutting forecasts. Copper prices rose 47% in the 12 months through August, while the Nasdaq Sp
How this was made
The 30-second read
Why it matters
The report suggests a tightening copper market, with supply shortfalls potentially supporting higher prices and affecting miners' earnings.
Market read
Copper supply constraints could drive price increases, influencing miners, industrial users, and commodity traders.
What to watch
Potential acceleration of brownfield expansions or acquisitions could mitigate supply gaps.
Background
Sprott Asset Management released a new report highlighting the first decline in global mined copper supply since 2017, citing specific mine disruptions and grade issues.
Ticker impact
Sprott reports disruptions at Freeport-McMoRan's Grasberg mine removing ~600,000 tonnes of copper supply.
Downside pressure on FCX share price in the near term.
Supply disruption is a material operational issue; market may price in lower output.
BHP's Escondida mine expected to drop production to 1.0‑1.1 Mt in FY2027 due to grade decline.
Potential modest decline in BHP stock as copper margins tighten.
Grade decline is a known long‑term issue; short‑term market reaction likely modest.
Market effects
Copper supply constraints could boost copper prices, benefiting miners and related equipment suppliers.
Chile and Indonesia production issues may shift demand to U.S. imports and inventories.
Potential upward pressure on global copper prices influences broader commodities markets.
Counterpoint
If grade declines are already priced in, the supply shock may have limited upside for copper prices.
Key entities
- CompanyFreeport-McMoRan
Operator of the Grasberg mine in Indonesia.
- CompanyBHP
Owner of the Escondida copper mine in Chile.
