Copper demand now tipped to slide in second half CY26 as prices continue to rise

While copper demand is tipped to ease throughout the second half of CY26, improving market support and tight supply are expected to keep prices elevated through CY28, before easing slightly by CY31, according to new data from the Australian government.

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The latest Resources and Energy Quarterly by the Federal Department of Industry, Science, and Resources (DISR) said global demand is likely to be impacted by geopolitical uncertainty and softer economic conditions.

Locally, though, Australia’s copper supply is forecast to achieve gradual growth due to delays in new mines and expansions.

The new findings come after global demand for newly refined copper rose by 1.3% year-on-year in CY25 to 27.9 million tonnes, with China’s copper demand jumping 4% year-on-year to 16.6 Mt, accounting for 59% of global copper usage.

Demand also rose in the U.S. (3.9%), India (5.2%) and Germany (3.6%), while growth was partially offset by declines in Korea (-8.6%), Japan (-4.5%), and the EU (-2.8%).

The dramatic demand growth saw London Metals Exchange copper prices take off, up 38% year-on-year Q1 CY26, reaching an all-time high of US$14,500 a tonne in January.

The DISR noted prices have since eased but remain elevated, supported by mine disruptions and risks of sulphuric acid shortages.

The quarterly report found Australian mine production is expected to keep growing, supported by expansions and new project developments.

However, local mined copper production is estimated to have registered a 2.2% decline year-on-year in CY25–26. That fall came after production slid at Boddington mine in WA from H2 CY25 due to lower ore grades and bushfire damage.

In CY25, Queensland’s copper output fell 13% year-on-year, reflecting the suspension of the Capricorn project after floods in 2024. The DISR also noted that Mount Colin entered care and maintenance in early 2025, and the Mount Isa underground copper mine ceased in July 2025. These declines were partially offset by modest growth in South Australia, where output rose slightly year-on-year, supported by steady output at BHP’s Olympic Dam and higher output at Hillgrove’s Kanmantoo.

Those declines also impacted Australian refined output, which fell by 27% year-on-year in the March quarter CY26, reflecting lower output at the Mount Isa smelter – driven by reduced feedstock following the closure of the Mount Isa underground mine in July and third-party feed following weather impacts across Queensland.

However, the local refined copper output is projected to gradually recover to reach 481kt by CY30–31, due to increasing production from BHP’s Copper South Australia and SX-EW operations in Queensland and South Australia.

Australia’s copper export earnings in CY25–26 are estimated to reach $14.6 billion, 17% higher than in CY24–25, driven by higher prices and increased export volumes.

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