FT: Copper Facing Major Supply Shortfall Starting 2027

The Financial Times is reporting that a big shortfall in copper supply is expected to open up from 2027, with major banks warning the market is heading into a structural deficit. For traders, this is the kind of multi-year setup that tends to pull miners, refiners and copper-linked ETFs along with it.

What the FT is flagging

The FT reports a big shortfall in copper supply is predicted to open up from 2027, with Citi, Deutsche Bank and JPMorgan warning of a structural deficit ahead.

Primary copper supply is set to fall short of demand through 2027, with the deficit forecast to peak at around 4.5 million tons after 2025 as pricing begins to reflect the tighter market.

Bank forecasts are getting more aggressive

UBS now estimates the 2026 global copper market will face a deficit of 520,000 metric tonnes, more than doubling from an expected 203,000mt shortfall in 2025. The catalyst list keeps growing.

Bank of America now forecasts copper averaging $11,313/mt in 2026 and $13,501/mt in 2027, with peaks near $15,000/mt. Deutsche Bank raised its 2026 forecast to $10,600/mt with peaks above $11,000/mt in the first half. Goldman Sachs maintains a more conservative profile at approximately $11,400/mt for 2026, warning that parts of the recent rally have been driven by speculative positioning rather than purely fundamental tightness.

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Why the deficit keeps widening

Supply constraints are already visible, with disruptions in Chile (Quebrada Blanca, El Teniente), Indonesia (Grasberg) and Peru (Las Bambas, Constancia), paired with slow permitting, tightening the market.

An S&P Global study finds electrification is projected to swell copper demand to 42 million metric tons by 2040, a 50% increase from current levels, while existing supply is poised to decrease. Global copper production is projected to peak in 2030 at 33 million metric tons, and unless significant adjustments are made, the disconnect will result in a supply deficit of 10 million metric tons by 2040, 25% below projected demand.

AI and data center demand plus defense demand are each expected to roughly triple by 2040, representing a combined 4 million metric tons of additional demand.

Options market and stocks to watch

Watch for flow and positioning across the copper complex as the 2027 deficit narrative gets priced in:

• FCX: Freeport-McMoRan is the most direct US-listed copper pure play and tends to move first on price spikes.
• SCCO: Southern Copper offers leveraged upside to sustained higher copper prices from its Peru and Mexico operations.
• BHP and RIO: Diversified majors with heavy copper exposure, including the Escondida and Oyu Tolgoi complexes.
• COPX: The Global X Copper Miners ETF for broader basket exposure if you want to trade the theme rather than a single name.

Watch for follow-through in mining equities and any pickup in call activity if physical premiums start climbing again. More market news here.

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