As 2025 comes to an end, the London Metal Exchange's copper prices once surged dramatically—just minutes after the Christmas opening, the increase hit 6.6%, even touching a historic high of $13,000 per ton. Although there was a correction in the afternoon, it ultimately stabilized at $12,428.50 per ton, still up about 2% for the day. This scene marked a perfect conclusion for copper in 2025: the best performance since 2009, with December alone soaring over 10%—the super cycle of the "King of Metals" is truly here.

This sharp rise in copper prices was not sudden. It was driven by a resonance of three factors: supply-demand imbalance, policy uncertainties, and industrial upgrade needs, with the supply side crisis being the most critical.

Global copper mining has truly been faltering this year. Peru's Antamina mine production plummeted by 26%, the Kamoa-Kakula project in the Democratic Republic of Congo cut its annual capacity by 28%, and Indonesia's Grasberg copper mine halted production entirely due to ore flow issues, expected to remain shut until the second half of 2026, with a potential restart delayed until 2027. Rough calculations show these issues alone have resulted in a loss of 250,000 to 260,000 tons of capacity.

Even more concerning is the continuous decline in copper ore grades worldwide. From 1.3% in 2005 to just 0.65% now, meaning copper is becoming harder to extract and more costly. Investment in new mining projects is also limited, with growth momentum clearly insufficient. Data from the International Copper Study Group shows that global copper mine production in 2025 only increased by 1.4%, with a supply-demand gap of 150,000 tons already present, which is expected to expand to 300,000 tons by 2026.

Beyond supply-side challenges, policy changes are also amplifying the effect. The trade policies under the new US leadership have introduced considerable uncertainty into the global commodities market, to some extent boosting risk aversion and demand expectations for scarce resources.

From an investment perspective, this surge in copper prices reflects a deeper logic: the global economic system’s reliance on basic industrial metals has not weakened—in fact, it has become more acute amid the push for new energy transitions and infrastructure investments. For investors holding commodities exposure or focusing on macro asset allocation, this signal may be worth considering.