Copper Drops 2.68% Despite 44% Supply Deficit Warning

Two days after BloombergNEF cautioned that copper supply could fall 44% short of demand by 2050, the metal lost 2.68% on October 22, breaking an April trendline that had held through five tests.

However, the same report sees the copper market in surplus in 2026. Traders seem to be focusing on that short-term condition rather than the long-term deficit.

Why Does Copper Stand Apart?

BloombergNEF (BNEF) issued its annual Transition Metals Outlook on October 20. According to the report, nine of the ten materials covered should have adequate supply through 2050.

Copper is the exception. BNEF forecasts a shortfall of 20 million tonnes by 2050, beginning as soon as 2028.

Demand is projected to rise 61% to nearly 46 million tonnes per year. Electric transport alone will contribute 11.4 million tonnes.

To close the gap would require $332 billion invested in new mines. Each mine takes about 17 years to become operational, according to BNEF.

Martin Tengler, head of metals and mining at BNEF, described the issue as a matter of timing.

“The challenge now is less about whether the world can produce enough metals overall, and more about whether the right materials will be available when and where they are needed.”

Copper is abundant. The US Geological Survey (USGS) estimates global reserves at nearly 980 million tonnes.

Why Did Copper Decline Despite the Warning?

BNEF’s own assessment also gives a flat 12-month price outlook for copper.

Physical market data backs this. The London Metal Exchange saw copper inventories climb to 272,950 tonnes, the highest since July 24, as reported by Reuters.

Most of the fresh metal ended up in US warehouses. Comex, the US futures exchange, moved to a discount versus the LME, wiping out its tariff-related premium.

Alastair Munro, a senior metals strategist at broker Marex, connected the two developments.

“…the recent build in LME copper stocks was the result of the COMEX premium shrinking as contract delivery dates draw closer.”

A selloff in tech stocks on AI uncertainties added further pressure, pushing LME copper to a five-week low.

Copper Supply Gap: Where Does the XCU Price Go From Here?

The trendline break confirms the risk highlighted during copper’s fifth support test this week.

That trendline formed the lower boundary of a rising wedge, a pattern that frequently resolves downwards. Trading volume increased on the break.

Additionally, copper faced rejection near $6.70 resistance. The Relative Strength Index (RSI), a momentum indicator, broke a support line that had held since March.

Copper is currently trading around $6.51 per pound, roughly 6% below its September record high. The next resistance is at $6.56, followed by the broken trendline near $6.64.

On the downside, the 0.382 Fibonacci retracement level at $6.31 could be the first support. Further supports are at $6.11 and $5.91.

However, if copper closes back above the trendline on a daily basis, the bearish scenario would weaken.

For the moment, copper is trading based on the near-term surplus rather than the 2028 deficit. The key question remains whether $332 billion in new mines will be built in time.