Copper Set for Best Month in Year as Supply Snarls Rattle Market

(Bloomberg) — Copper headed for the biggest monthly advance in a year, trading just below a 16-month closing high, as investors weighed supply setbacks against weak data from China’s manufacturing sector.

Three-month futures were slightly lower near $10,382 a ton, but remained almost 5% higher in September, set for the biggest rise since the same month in 2024. Prices have been supported by supply disruptions, with the latest Freeport-McMoRan Inc.’s declaration of force majeure at the Grasberg mine in Indonesia. On Monday, copper ended at the highest since May last year.

“The longer the mine stays offline, the longer the rally will last,” Societe Generale SA analysts said in note, describing copper as “on fire”. Following the halt at Grasberg, and given steady increases in demand, the market could be on track this year for the largest annual deficit since 2004, they said.

On the macro front, meanwhile, data from China on Tuesday showed factory activity extended its decline into a sixth month, marking the longest slump since 2019. The official manufacturing purchasing managers’ index was at 49.8 — with figures below 50 showing a contraction. It’s the first evidence that weakness in the economy persisted through the end of the third quarter.

“Looking through the volatility of seasonal and other temporary factors, we see an economy that needs more policy support to avoid a steeper pullback,” Bloomberg Economics said.

Copper has had a volatile year, buffeted by supply outages and shifts in the Trump administration’s trade policy, both in the form of country-specific levies and sectoral tariffs aimed at some types of US copper-product imports. At the same time, there are widespread expectations for stronger demand, including for the energy transition and artificial-intelligence data centers.

Copper futures dipped 0.3% to $10,382.50 a ton on the London Metal Exchange at 11:22 a.m. in Singapore, up by about 18% this year. Prices peaked just above $11,000 in May last year.

In other metals, aluminum, zinc, nickel, lead and tin all traded lower on the day.

©2025 Bloomberg L.P.