Copper price slides as monster storm bears down on Chile and Iran flare-up rattles metals

Copper retreated in after-hours trading on Thursday as an escalation in US-Iran hostilities sparked a broad selloff across metals. Damage to copper prices was more limited than gold and silver as a powerful storm sweeping across Chile kept supply risks squarely in view.

Copper for September delivery settled little changed at $6.342 per pound ($13,980 a tonne) on the Comex, holding near three-week highs, before sliding 1.1% to $6.27 a pound in evening trade as of 9 p.m. in New York. The most-active contract is now trading about 6% below the all-time high above $6.60 a pound set in early June. In London, three-month copper ended the midweek session at $13,585 a tonne, with LME cash copper up nearly 8% so far this year.

The late-session pressure came after the US struck an oil tanker near Iran’s main export terminal for the first time since the restart of the blockade, driving the dollar and bond yields higher and rekindling expectations that the Federal Reserve may need to hike rates to contain oil-fuelled inflation. Gold fell 2.1% to below $4,000 an ounce and silver dropped almost 4%, while the S&P 500 lost 0.5%.

Category 5

Copper’s relative resilience owes much to Chile, where a major winter storm — classified as a potential Category 5 atmospheric river, the highest rating for such events — began sweeping across the country on Thursday, knocking out power and damaging homes in the south before an expected hit on the central copper heartland with as much as 150 millimetres of rain.

“We are going to have power outages,” Interior Undersecretary Máximo Pavez said Thursday. “We are doing everything possible so that authority coordination means a swift restoration of service, but with the wind we have, that service will be affected.”

The government convened emergency talks with mining industry representatives earlier this week and is coordinating with miners to make infrastructure, equipment and machinery available for the response, according to a Mining Ministry statement. The country’s largest copper export terminals remain largely operational.

The storm threat lands on an already stretched supply picture. Antofagasta reported this week that first-half copper output dropped 9.5% to 285,000 tonnes on lower production at two key mines, BHP has flagged declining Chilean output for next year, and the IEA warned just today that constraints on sulphuric acid supply have left the copper market facing a near-term outlook that has “worsened considerably”.

Chile’s own government underscored the tension on Wednesday: it cut its 2026 economic growth forecast to 1.8%, citing “elevated uncertainty associated with the conflict in the Middle East” — while raising its 2026 copper price assumption to $5.90 per pound from $5.46, joining a lengthening list of upgraded copper forecasts.

Miners caught in the selloff

Copper equities took the Iran news harder than the metal. Freeport-McMoRan (NYSE: FCX) fell 4% and Ivanhoe Mines (TSX: IVN) lost 4.9%, while Antofagasta (LSE: ANTO) gave up 4.1% after its production report and Southern Copper (NYSE: SCCO) shed 3.2%. BHP (ASX: BHP) slipped 2.3% on the day of its full-year results. 

(With files from Bloomberg and Reuters)