According to the latest news from foreign media, the global copper pattern is undergoing a major change. Due to mine closures and production disruptions, many analysts have begun to downgrade their surplus, which is undoubtedly a positive sign for copper price movements.
On Friday, London Metal Exchange (LME) copper futures hit a four-month high of $8,640 a tonne. This was partly due to Anglo American lowering its production guidance. The London-listed miner said copper production next year is expected to be in the range of 730,000-790,000 tonnes, a 20% downward revision from previous estimates. In addition, the company's production forecast for 2025 has been revised down by 18%.
Anglo American is currently undertaking maintenance and upkeep at its Los Bronx facility in Chile, while the Quilaveco copper mine in Peru has been adjusted to ensure safe passage through the geotechnical fault line. Macquarie analyst Ellis?Ms Fox said Anglo American's new guidance for 2026 was well below her estimates. In addition, Vale also issued new production guidance, which was also below market expectations. This means that if demand remains constant, the outlook for copper prices will be more positive.
Brazil's Vale expects copper production to be between 320,000 and 355,000 tonnes in 2024, compared to 325,000 tonnes this year. Macquarie now expects the global copper market to have a surplus of 100,000 tonnes and 280,000 tonnes in 202570,000 tons, which is 2030,000 tons and 3690,000 tons have dropped significantly. Global copper production is expected to reach around 27 million tonnes next year and in 2025.
In addition, the disruption of production at First Quantum's Kobrai copper mine has attracted a lot of attention from the market. The mine accounted for 1% of the world's copper production last year. The future of the mine is uncertain following the Panamanian Supreme Court's declaration last month that First Quantum's operating contract was unconstitutional. Bank of America analyst Michael ?Wedmer has removed Panama Copper from next year's copper crop and changed the forecast for a supply-demand balance from a small surplus to a shortage. He believes that the reopening of the Kobre copper mine as early as Panama** in May 2024 seems unlikely. He also pointed out that once the new ** is formed, First Quantum may start negotiating a contract with the **. While the election could bring about change, we now assume that the Kobre copper mine could restart in the fourth quarter of next year.
In the overall market environment, the impact on copper prices will be positive as tensions rise, especially after Anglo American announced its production cut target. This not only brings a new balance to the market, but also provides strong support for the future trend.