Cochilco, Chile, raises its copper price forecast due to improved global outlook

The Chilean state copper commission Cochilco increased its average copper forecast for this and next year on Wednesday. It cited an improved outlook globally following a pause between the United States' and China's tariff war.

The commission raised its average price forecast for 2025 and 2026 from $4.25 per pound in its previous report to $4.30.

Cochilco's leadership, in a press release, expressed cautious optimism about copper prices. They also acknowledged a tighter global supply situation than expected and strong fundamentals for demand.

The agreement reached between the U.S.A. and China earlier this month to reduce steep tariffs by at least 90-days "has reduced trade barriers and eased tensions which were affecting the confidence and dynamism in global trade," Cochilco stated.

Cochilco sees that long-term trends such as the energy transition, the expansion of electric grids and electric vehicles, and energy storage will continue to support copper prices.

Codelco and Antofagasta Minerals, the world's biggest copper producers, both saw their production increase in the first three months of the year. Cochilco reported that the production of state-owned Codelco grew by 5.2% in April.

Despite the increases in domestic demand, they did not compensate for a global drop. Cochilco expects the global supply growth to be lower this year than previously estimated, with a 1.3% increase from its previous estimate of 4.7%.

Victor Garay, Cochilco’s mining market coordinator said that any disruption in supply would directly impact the price.

Separately the agency predicted that Chilean copper output would increase by 3% in this year, and again in 2026 when it was expected to reach 5,84 million metric tonnes.

The production guidance is a downward revision from Cochilco’s estimate in February of a 4.6% growth rate in 2025, and a 3.6% increase in 2026.

Cochilco anticipates that global demand will grow by 2.8% and 2.3% respectively, resulting in a deficit of 109,000 tonnes of copper this year. Reporting by Fabian Cambero. Brendan O'Boyle wrote the article. (Editing by Mark Potter and Natalia Siniawski)

(source: Reuters)