Goldman Sachs Boosts Copper Target to $13,735 as US ‘Hoarding Spree’ Drains Global Supplies

 

The global scramble for industrial commodities has entered a volatile new phase. According to a comprehensive research briefing released on June 1, 2026, by TrendFocus, Goldman Sachs’ commodities research team has aggressively raised its price targets for copper, warning that a massive import surge by the United States is rapidly draining available supplies outside the U.S. and creating an unprecedented supply deficit.

Analyst Aurelia Waltham lifted Goldman's year-end 2026 London Metal Exchange (LME) copper target price from $12,465 to $13,735 per ton. Additionally, the bank raised its 2027 average price forecast from $12,150 to a stinging $13,800 per ton.

The underlying market forces are driving a stark polarization: while the United States heavily fortifies its domestic stockpiles, international markets are being pushed into a supply crunch far deeper than previously models predicted.

🇺🇸 The Tariff Front-Running: Locking Up Global Supply

The immediate catalyst behind this price adjustment is defensive front-running by American industrial buyers. Fearing that Washington may soon impose sweeping new tariffs on imported copper, U.S. importers have launched a aggressive buying campaign, attempting to secure physical inventory before any protectionist trade policies take effect.

MARKET DEFICIT OUTSIDE THE U.S. (2026 PROJECTIONS)
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Previous Estimate: 60,000 Tons
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Revised Goldman Sachs Estimate: 640,000 Tons
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Goldman Sachs has nearly doubled its forecast for accumulated U.S. copper inventories for 2026, raising it from 550,000 tons to 900,000 tons. Once this material crosses into domestic American warehouses, it is effectively "locked up"—taken off the international market and no longer available to settle international contracts on the LME.

Consequently, the supply gap in markets outside the U.S. is now projected to hit 640,000 tons in 2026 and 170,000 tons in 2027—monolithic increases over previous baseline estimates of 60,000 and 40,000 tons respectively.

⛏️ Double Whammy: Mine Disruptions and Broken Scrap Channels

While the demand side is being artificially inflated by trade policy anxieties, the supply side is crippled by prolonged structural challenges at two of the world's most significant mega-mines:

1. Grasberg (Indonesia): Still reeling from severe operational accidents suffered in 2025.

2. Kamoa-Kakula (DRC): Production remains severely bottlenecked following logistical and localized infrastructure disruptions last year.

Latest geological and engineering audits indicate that neither asset will return to full operational capacity until 2028. As a result, Goldman has slashed its 2026 global mine supply forecast by 350,000 tons, wiping out 1.5% of the planet's expected extraction baseline. To complicate matters, secondary supply channels have dried up; domestic scrap copper production in China fell by 12% year-on-year in the opening months of 2026, removing a critical buffer for smelting facilities.

🔮 Three Divergent Path Scenarios

With LME spot copper currently hovering at $13,600 per ton—up roughly 10% year-to-date and sitting just below mid-May’s historic nominal peak of $14,153—Goldman Sachs mapped out three distinct macroeconomic paths for the remainder of the year:

Market Scenario	Price Outlook	Core Catalyst & Dynamics
Scenario 1: Extended Hormuz Closure	$12,600 Support	If the Strait of Hormuz remains blockaded past June, a global GDP hit of 1.1% will cut 300,000 tons of copper demand. However, sulfur shortages would simultaneously paralyze 325,000 tons of mine output across Chile and the DRC, keeping fair value steady while speculative capital flees.
Scenario 2: U.S. Tariffs Formally Set for 2027	Above $14,000	If additional copper tariffs are announced in June to take effect in January 2027, an unprecedented, panicked buying frenzy in H2 2026 will drive prices past all-time highs before correcting down to $13,900 in 2027.
Scenario 3: U.S. Explicitly Rejects Tariffs	$12,800 Retrenchment	The hoarding narrative evaporates. Markets outside the U.S. register a modest 130,000-ton surplus in 2027, deflating prices. Analysts note, however, that the threat of future tariffs would remain a permanent diplomatic lever.

⚡ The New Composability: AI and Grids Provide a Absolute Floor

Goldman's price data models demonstrate a highly sensitive market structure: for every 75,000 tons of inventory depleted from international tracking systems, copper prices experience an automatic 1.4% premium lift. The bank calculates that the underlying physical fair value is roughly $12,600 for 2026, meaning the current spot price of $13,600 carries a clear premium.

However, analysts emphasize that this premium is entirely justified by macro structural shifts. Copper is effectively breaking away from standard economic cycles. It is no longer just a building material tied to construction or domestic home appliances; it has transitioned into a critical strategic asset essential for AI data center infrastructure, national defense systems, and grid modernization.

In China, despite record-high copper pricing, apparent demand still grew by 1% year-on-year in Q1 2026. This was driven entirely by a massive 10% expansion in grid and power transmission infrastructure spending, completely absorbing a cooling solar and electric vehicle production footprint. By 2030, grid expansions are modeled to command more than 60% of all global copper demand growth. This structural floor means that even in a broader economic slowdown, the red metal has found an insulated, high-yielding haven.

Will the high-tech demands of AI and power grids keep copper prices sustained above $13,000, or will a resolution of tariff fears trigger a sudden selloff? Give us your commodity predictions below.