Copper prices jumped nearly 5% after the operator of Indonesia’s Grasberg mine declared force majeure on contracted supplies, highlighting fragile market sentiment around supply risks. The halt followed an accident at the mine earlier this month. Commerzbank’s Head of FX and Commodity Research, Thu Lan Nguyen, notes that concerns about shortages have intensified as treatment and refining charges at copper smelters collapsed, signaling tight raw material availability.
Copper surges on grasberg force majeure
“The Grasberg announcement underscores market sensitivity, but the broader supply picture remains solid,” Nguyen said. Despite disruptions in Indonesia, global mine production in the first seven months of 2025 has grown by 3.4%, driven by top exporters Chile, Peru, and the Democratic Republic of Congo. Indonesia’s output declined 32% due to pre-existing issues at Grasberg.
Production remains high, surplus persists
Global metal production rose 3.9% during the same period, exceeding last year’s output. Chinese smelters have urged tighter regulation on production expansion, suggesting growth may moderate but remain elevated.
Although copper demand is rising—largely due to China, which accounts for roughly 60% of global demand—production growth has maintained a supply surplus of 100,000 tons. While this is less comfortable than last year’s surplus of 400,000 tons, the market remains broadly well-supplied.
