FX.co ★ Copper Futures Jump to 2-Month High

Copper futures soared over 4%, reaching $4.77 per pound, marking the highest level in two months. This rise followed Freeport-McMoRan's announcement of force majeure on shipments from its Grasberg mine in Indonesia, the world’s second-largest copper source. This decision came in the wake of a tragic incident on September 8, which resulted in the deaths of two workers and left five missing amid a substantial mud flow of approximately 800,000 metric tons. Consequently, Freeport has reduced its forecast for quarterly copper and gold sales by 4% and 6%, respectively. This incident underscores the copper market’s vulnerability to supply interruptions, a situation further exacerbated by Hudbay Minerals suspending operations at its Constancia mine in Peru due to ongoing protests. The Grasberg mine alone is responsible for 3.2% of the world's mined copper, nearly 30% of Freeport's copper production, and 70% of its gold output, highlighting the significant impact of such disruptions. Prolonged outages could potentially drive prices even higher and place additional pressure on the smelting industry.