Metal Price News - December
Prices are still increasing across the board, and copper has hit a new record high. But the copper market is driven by uncertainty and not actual facts. For stainless steel, CBAM and the Safeguard quota are driving the price changes.
Macroeconomic developments
Right now, each metal is moving at a different speed, and the macro perspective is less influential than usual. So, this month we are instead diving into each metal in more detail.
Copper
The copper price has been unusually high in recent months. In September, the price surpassed $10,000/t, and it has since peaked at an all-time high of $11,900/t.
Overall, the price has increased by more than $2100/t (21%) since September.
But what is the driving factor behind these high price levels? All we can say is that facts and feelings do not seem to match up on the copper market right now.
Let us take a look at the facts first:
Reduced demand from China
China is always a good place to look when the copper price is moving. The reason is that China accounts for approximately 45% of global copper production and 60% of global copper consumption.
Construction of real estate alone accounts for 8-14% of China’s copper consumption, so the Chinese real estate slump of this year is having a significant impact. The internal demand for copper has simply dropped.
Consequently, the Chinese smelters have so much extra capacity that they are paying the mines to gain access to the copper. But the smelters have also reduced capacity to get a better hand in this situation, so the supply is slightly reduced.
Overall, it is a significant factor that China as a major player on the copper market is facing dwindling demand.
The mining accident in Indonesia
As we have been writing about since September, there has been an accident in the world's second largest copper mine. The mine accounts for 3% of world production. Even though production has resumed, the mine is not likely to be back at full capacity (750,000 t/year) before 2027.
This means that global supply will be around 300,000 tonnes less next year.
Global supply and demand
With both demand and supply decreasing, it is interesting to look at the global copper stocks. As 2025 draws to an end, the stocks are around 300,000 t higher than they were at the end of both 2024 and 2023.
This surplus is an exact match for the Indonesian shortage next year, which should mean that the market is balanced. Combined with dwindling demand in China, we should be seeing stable or even reduced prices. Instead, they are soaring to record-high levels.
Data centres, electric cars and wind turbines are often seen as major factors in the copper market, but these products only account for about 2% of total global consumption. Far from enough to explain the unusual price.
So, these are the facts about the copper market right now. But what about the feelings?
Uncertainty and speculation in the market
The mechanics of a rising market are very simple: There are more buyers than sellers. But why is everyone buying, when demand is falling and supply is high?
As we see it, uncertainty is the biggest factor. There is no factual basis for the price to be record-high at this time. And once uncertainty starts to drive the price upwards, speculators enter the scene to reinforce the upwards spiral.
Donald Trump's copper tariffs have been the main cause of uncertainty lately. The tariffs may even increase in Q3 or Q4 of 2026, and the US copper price (COMEX) is already higher than the European price (London Metal Exchange).
The supply and demand situation in China and the Indonesian mine are also causing some uncertainty.
Aluminium
On aluminium, the picture looks different. Under normal circumstances, aluminium and copper follow each other’s ups and downs closely. But aluminium has stayed at a much more normal level this time, although it has risen a bit to keep up with copper.
Since September, the price has gone up approximately 10%, and the market expects the price to remain in that range for quite some time.
Supply and demand
If we look at supply, global stocks have been falling over the past six months, but they are at the same level as at the end of 2024 and 2023.
In contrast to copper, there is not an abundance of aluminium, and one may wonder why it is copper and not aluminium that has skyrocketed under these circumstances. This further proves that the price of copper is not driven by the actual supply and demand in the market right now.
We are seeing more buyers than sellers in the aluminium market, but to a much lesser extent than for copper. Overall, we believe that the aluminium market is balanced.
Stainless steel
On stainless steel, we still see a lot of uncertainty about CBAM and the safeguard quota system. Both are causing fairly significant price surges, even though the actual taxes and quotas are still unknown, and even though Europe can cover most of the production internally.
One of the reasons for the price surge is that several European mills have been importing some of their raw material from Indonesia and are now trying to find those quantities within Europe to avoid the CBAM tax.
At the same time, the overall demand for stainless is rising, and this is also pushing the price upwards – but the market price from European mills is still roughly 120-150 €/t below what the market can take. This indicates that the prices will soon begin to go up.
On a positive note, the changes to the safeguard quota will likely create a more stable market in Europe. In the past, we have seen large fluctuations at the beginning of each quarter when the quota opened, which caused a lot of unpredictability in the market.
Plates/sheets
On plates/sheets, Europa has the capacity to cover the volumes that are currently imported from Asia. But the mills are noticing the increasing demand and raising prices.
Although the capacity is available in Europe, it is not inconceivable that we will see a temporary bottleneck on plates and tubes in Europe in 2026 until supply and demand find a new balance. If that happens, prices will rise further.
Bars
On bars, the changes to the Safeguard quota will hit a little harder on standard qualities 4307 (304), 4404 (316) and 4305 (303), because large quantities of the standard products are imported from Asia. As a result, we may see increasing prices and lead times.
If large quantities are still to be imported from Asia, it will be with significantly higher tariffs and taxes than today.