High growth potential may lead to more gains in Hindustan Copper stock

The long-term trend for copper is bullish, due to rising demand from grids, data centres and artificial intelligence (AI) infrastructure. But in 2025, copper has been bullish due to supply disruptions, and fear of potential US tariffs.

- DEVANGSHU DATTA

Inventories outside the US are low, and there could be further price upside if global demand for copper picks up.

Supply was in deficit by 200,000 tonnes for 2025 and in 2026, supply is likely to be in deficit to the tune of around 600,000 tonnes. Mining has been disrupted, and refined metal production has been hurt by tariff risks. Chile, the world's largest copper producer, is experiencing falling ore grades.

Flooding at Kamoa-Kakula mine in the Democratic Republic of Congo (DRC), an accident at El Teniente mine in Chile, and declaration of force majeure at Grasberg mine in Indonesia have hit ore supplies. These incidents have prompted global miners to reduce guidance for CY25 and FY26.

US tariff policies have caused price distortions between US COMEX and LME benchmarks. Traders have stockpiled refined copper in the US to frontrun potential tariffs, pushing COMEX prices well above LME. Though refined copper has so far been exempted, a potential 15 per cent tariff hike will be reviewed in June 2026. If a tariff is imposed, it will lead to wider price differentials. If tariffs are not imposed, stockpiled US copper may be sold, leading to global surplus.