Copper Prices Fall as AI Demand Doubts Offset Mine Disruptions

Copper prices fell despite fresh supply disruptions, as investors questioned near-term demand from the AI trade. Three-month copper on the London Metal Exchange slipped to $14,356.50, below September's record of $14,875. Earnings from Alphabet and Intel have weakened confidence in AI-related demand. Rio Tinto suspended underground work at Oyu Tolgoi in Mongolia after seismic activity along a fault zone injured three workers. Oyu Tolgoi is one of the world's largest copper projects. Freeport-McMoRan's Grasberg mine, which supplies about 3% of global copper, will not return to full capacity until early 2028 after repairs from a mudslide. The postponement marks the second delay. SunSirs said the mine's 2026 target fell to 478,000 tons from about 700,000 tons, a shortfall exceeding 900 million pounds. Codelco, the world's largest copper miner, dismissed an executive and referred the matter to prosecutors after an internal audit. The audit found 26,875 tons from Chuquicamata and Ministro Hales were wrongly classified as finished product instead of work-in-process, about 2% of 2025 output. Plusmining executive director Juan Carlos Guajardo said the discrepancy raised serious concerns about Codelco's internal controls, traceability and ability to verify operations. Cobre Panama remains closed under care and maintenance since the end of 2023, after the government ruled the mine's concessions unconstitutional. The mine previously supplied about 1.5% of global copper. First Quantum Minerals confirmed a Ministerial Commission recommended starting formal negotiations. First Quantum has not announced a date. EY's survey of 400 mining executives ranked operational complexity as the top industry risk for 2027. EY global mining and metals leader Paul Mitchell said aging mines and depleted reserves are making mining more complex. Regulatory delays also add complexity, according to the survey. Variation in reserve grades was cited by 29% of respondents; 24% to 26% cited material handling, processing capacity, transport or equipment reliability. EY ranked access to capital second and supply chains third. Financing is shifting: 44% of miners are seeking funds from equipment manufacturers. Sovereign wealth funds and governments each provided financing for 39% of miners. Public financing commitments for critical minerals rose more than fourfold between 2023 and 2025 to about $65 billion. EY said 52% of miners are building stockpiles. Reuters quoted JPMorgan analyst Patrick Jones as saying sentiment had moved toward greater caution, not an outright bearish stance. Benzinga Pro data showed Rio Tinto shares trading at $82.81 in Friday's premarket session, down 0.53%.