Mercuria withdraws huge volume of copper from LME as prices soar

Mercuria Energy Group Ltd. has ordered about $500 million of copper for withdrawal from warehouses overseen by the London Metal Exchange, as the trading house positions itself for a global supply crunch fueled by possible US tariffs.

The firm was the key party involved in requests to withdraw about 50,000 tons of copper from LME depots on Wednesday, according to people familiar with the matter, who asked not to be identified discussing private trading activity. The cancelation of stock was the biggest seen in more than a decade, and it helped drive prices towards record highs above $11,500 on the LME.

Copper pricing dynamics and trade flows have been upended since President Donald Trump in February announced plans to place tariffs on the metal in a bid to boost US supply. The decision caused futures in the New York to spike above those on the LME, and spurred a record surge in US imports as traders including Mercuria, Trafigura Group and Glencore Plc capitalized on the arbitrage.

The trade was interrupted in late July after Trump unexpectedly spared commodity-grade forms of the metal from tariffs, but in recent weeks trading houses have again been racing to ship more metal to US shores. Crucially, Trump has pledged to revisit plans to impose duties on primary copper next year, and a fresh surge in New York futures has provided another opening for traders to front-load imports before any levies come in.

Kostas Bintas — who joined Mercuria last year to spearhead a rapid expansion into metals markets — told Bloomberg last week he expects prices to push deeper into record territory in the weeks ahead as the trade gathers steam, with buyers outside of the country potentially facing critical shortages in the first quarter of next year.

“This is the big one,” he said in the interview. “If the world keeps going like this we will be left without copper cathodes in the rest of the world.”

A spokesperson for Mercuria declined to comment on the request to withdraw copper from the LME.

Bintas’ bullish call is the latest prediction that a long-anticipated surge in copper prices may finally be about to occur, with executives at rival trading houses IXM SA and Gunvor Group also warning in recent months that a string of mine disruptions risked creating supply shortfalls.

Copper’s push into record territory comes despite a softening outlook for demand — particularly in top consumer China — but Bintas said he expects that manufacturers will need to pay increasingly high prices as shipments to the US accelerate and exchange inventories dwindle.

Traders routinely take and deliver large volumes of metal from the LME’s global warehousing network, which is designed as a market of last resort during periods of shortage or oversupply. The large majority of the metal underpinning the LME’s copper contract is of Chinese and Russian origin, which can’t be delivered against contracts on New York’s Comex.

But there are growing expectations that LME stocks will be drawn down to service customers outside of the US, in order to free up additional supply that can be shipped into the country. Traders ordered a further 7,450 tons of copper from LME depots on Thursday.

The US already has a huge surplus of metal in ports and exchange warehouses, but traders and analysts don’t expect it to flow back out while Comex contracts continue to trade at a premium, and the threat of tariffs remains.

“Conversations with physical traders point to a larger-than-expected reacceleration of copper flows into the US in H1 2026,” analysts at Goldman Sachs Group Inc. said in an emailed note on Wednesday. The day’s rally was “driven by LME cancellations, which are likely to free up metal to deliver to the US.”

A spokesperson for the LME declined to comment.

(By Mark Burton and Archie Hunter)