Copper market faces crisis as LME inventories hit historic lows

The London Metal Exchange (LME) is grappling with one of the most severe copper shortages in history. Rapidly dwindling inventories have driven prices up to multi-year highs. On Monday, copper traded at a $280-per-ton premium, the largest since 2021, as reported by Bloomberg.

LME commodity stocks have long served as a buffer for metal producers. When market demand surges, manufacturers can source raw materials from the exchange’s warehouses. In times of oversupply, they might sell their reserves on the trading platform.

However, LME warehouses have seen their copper stockpiles plummet by about 80% since 2025. If consumers keep going at the current rate, global reserves will run out of the metal in less than a day. The dramatic depletion, according to the news agency, is due to the worldwide rush for US copper before anticipated import tariffs take effect, thus leaving buyers from other countries struggling to secure supplies.

Although demand has softened slightly in recent weeks, with some Chinese smelters exporting surplus metal to capitalize on higher prices, the broader market remains under strain.