COMEX copper to $7.00/lb by year-end 2026: the grid-deficit case

COMEX copper reaches $7.00/lb by December 31, 2026 in the base case, $7.50/lb in the bull case, and $5.40/lb in the bear case. The base case rests on JPMorgan’s projected 330,000-tonne refined-copper deficit for 2026, COMEX warehouse stocks that have absorbed more than 400,000 tonnes of tariff-arbitrage flow since 2025, and a structural grid-and-data-centre demand pulse that the supply side cannot match before the next mine cycle. The thesis breaks if any one of four signals fires, listed in the Disconfirmation section.

COMEX copper traded around $6.28 per pound on May 21, 2026, having pulled back from the all-time intraday high of $6.7160/lb set on May 14, 2026 (Trading Economics, May 21, 2026). JPMorgan Global Research projects copper averaging roughly $12,075 per tonne across full-year 2026 against a refined deficit of about 330,000 tonnes (J.P. Morgan, 2026), while Goldman Sachs trimmed its 2026 LME average to $12,650/tonne in April 2026 from $12,850/tonne, citing softer demand expectations (Investing.com, April 2026). The base case to $7.00/lb COMEX (roughly $15,400/tonne LME) sits above both — the article that follows explains why.

Key Levels:

• COMEX copper (HG): $6.28/lb spot — Trading Economics, May 21, 2026
• Base case target: $7.00/lb by December 31, 2026 — JPM-deficit + grid-demand methodology
• Bull case target: $7.50/lb if China stimulus credit impulse turns positive and COMEX stocks drop below 350,000 tonnes
• Bear case target: $5.40/lb if a US-China tariff de-escalation triggers COMEX-to-LME outflows above 75,000 tonnes per month
• Major support: $5.95/lb — April 2026 swing low
• Major resistance: $6.7160/lb — all-time intraday high, May 14, 2026
• Invalidation level: weekly close below $5.80/lb — breaks the post-tariff arbitrage regime

Methodology and what this call is built on

This call uses three datasets, all dated to May 2026 or later. First, COMEX and LME settlement prices and warehouse stock series from CME Group and the London Metal Exchange. Second, the J.P. Morgan Global Research copper outlook and the Goldman Sachs Research copper forecast updates as the bracketing sell-side views. Third, China industrial production and Caixin / NBS PMI prints as the demand-side check. The time window is full-year 2026 with the call dated December 31, 2026; the lookback is 24 months for the COMEX inventory series and 60 months for the LME stock series. The principal caveat: tariff-driven inventory movement makes COMEX a poor leading indicator of global tightness this cycle. Where appropriate the article points at LME stocks and SHFE bonded-warehouse prints instead.

Related:Silver to $95 by Q3 2026: the ratio-compression case

The data: a tariff-distorted COMEX, a tightening LME

COMEX warehouse stocks stood at more than 503,000 metric tonnes as of mid-May 2026, up from under 100,000 tonnes a year earlier (S&P Global, 2026). That five-fold build is not a demand-collapse signal — it is the visible inventory leg of the tariff-arbitrage trade that pulled metal out of LME warehouses and into US-bonded storage to front-run Section 232 measures. The LME has correspondingly drawn down. Hedge-fund net long positioning in COMEX copper reached a 20-week high in 2026 even as prices retreated from the May 14 record (Discovery Alert, 2026), an unusual setup where speculators are leaning into a market the inventory pictures supposedly call overbought.

Sources: Trading Economics, CME Group, S&P Global Commodity Insights, Goldman Sachs Research, J.P. Morgan Global Research, China NBS. Time window: February 2026 – May 2026.

The cross-source synthesis matters. Goldman’s downward revision is anchored to softer demand from a slower global growth picture. JPMorgan’s higher target rests on the deficit math. Both can be partially correct: 2026 can be a deficit year while growth disappoints, because the supply side is the binding constraint. Mine output from Codelco, Freeport-McMoRan, and Glencore guidance for 2026 sits below the consensus that was priced into copper in late 2024, and the Cobre Panamá restart has slipped again. That puts a floor under prices that purely demand-side bear cases miss.

“We project that copper prices will fall from very high levels in 2026 as the global supply surplus expands, with our forecast pointing to a range of $10,000 to $11,000 per tonne on the LME.”

— Goldman Sachs Research commodities team (Goldman Sachs Insights, December 2025)

The mechanism: grid-buildout, AI data centres, and a supply pipeline that cannot respond

The bullish case for $7.00/lb COMEX rests on three structural demand legs and one supply leg, in that order. Demand leg one: electrical grid renewal in the United States and Europe, with the US Inflation Reduction Act and the EU REPowerEU programmes pushing transmission and distribution capex into a multi-year peak. Demand leg two: AI data-centre buildout, which is copper-intensive at the busbar, switchgear, and cable level — the same theme our coverage of the AI-capex and Fed-cut case behind the S&P 500’s path to 7,800 tracks from the equity side. Demand leg three: EV powertrain and charging-infrastructure copper content, which is now running ahead of 2024 forecasts even as EV sales growth in some Western markets has eased.

The supply leg: refined-copper additions for 2026 fall short of demand by JPMorgan’s 330,000-tonne estimate. New project sanctions over 2023-2025 were dominated by tier-2 assets with longer ramp curves. Codelco’s 2026 guidance is at the low end of its prior range. The contrarian view is that the same tariff arbitrage that filled COMEX warehouses can run in reverse — a US-China tariff de-escalation would pull metal back to Asian bonded storage, COMEX stocks would draw down faster than LME stocks rebuild, and the visible-inventory headline would flatten the futures curve. That risk is what holds the bear case at $5.40/lb rather than $4.50/lb.

What the model misses: a 2015-style China credit-impulse stall

The thesis assumes that China’s credit impulse stays neutral-to-positive through year-end. The historical analogue that breaks the call is 2015, when a property-led credit pulse rolled over in Q2 and LME copper fell from $6,500/tonne to under $4,500/tonne by November of that year. The 2026 version of that risk is different — property is no longer the swing demand factor, infrastructure stimulus is — but the price effect would rhyme. A second model limit: COMEX warehouse stock as a tightness indicator has been broken for two years by the tariff distortion. Any directional read from the COMEX number alone risks being wrong on regime change. The article uses LME stocks, SHFE bonded warehouse data, and physical premium prints in Shanghai and Yangshan as the cleaner tightness signals.

“What I can say with a high degree of confidence is that the market’s tight right now, and it doesn’t take much to send prices north.”

— Mike Henry, Chief Executive Officer, BHP Group (CNBC, December 2025)

What would invalidate this call

The base case to $7.00/lb breaks if ANY ONE of these four signals fires:

• US-China tariff de-escalation reverses the COMEX-to-LME inventory split. Specifically, COMEX-to-LME monthly outflows above 75,000 tonnes for two consecutive months would compress the COMEX-LME premium and pull COMEX back below $5.95/lb.
• China Caixin manufacturing PMI prints below 49.0 for two consecutive months. The thesis assumes the credit impulse stays neutral-to-positive; a sub-49 print pair is the cleanest signal that infrastructure stimulus is not following the political signal.
• JPMorgan revises the 2026 deficit estimate to below 100,000 tonnes. The 330,000-tonne deficit is the single largest support beam in the bullish leg.
• COMEX HG copper weekly close below $5.80/lb. That level breaks the post-tariff arbitrage regime that has held since H2 2025 and historically marks regime change in the metals complex — mirroring the white-metals dynamic our reporting on when pessimism gets bullish for white metals flagged.

What to watch next

Three observable markers between now and December 31, 2026 shape the read. First, the June and July CME / S&P Global COMEX stock prints — any deceleration in the build is the earliest tell that the tariff arbitrage is exhausted. Second, the next J.P. Morgan and Goldman Sachs commodity outlook updates, which historically print mid-quarter and would reset the bracket on the call. Third, the August and September Caixin China PMI prints, which will frame the Q4 demand backdrop. Watch the 25-delta risk reversal in copper options around the 3-month tenor — the structural change in skew would lead any spot move into the year-end target. The Trump-tariff regime’s effect on the curve is well documented in our earlier coverage of Pretiorates’ Thoughts 74 – Make Copper Expensive Again.

TL;DR

COMEX copper reaches $7.00/lb by December 31, 2026 in the base case, $7.50 bull, $5.40 bear. The thesis rests on J.P. Morgan’s 330,000-tonne refined-copper deficit estimate for 2026 (J.P. Morgan Global Research, 2026), structural grid and AI data-centre demand, and a supply pipeline that cannot respond before the next mine cycle. The call breaks if China Caixin PMI prints sub-49 for two consecutive months, the COMEX-LME inventory split reverses, JPM revises the deficit below 100,000 tonnes, or COMEX HG closes below $5.80/lb on a weekly basis.

FAQ

What is the COMEX copper price right now?

COMEX copper traded around $6.28 per pound on May 21, 2026, having pulled back from the all-time intraday high of $6.7160 per pound set on May 14, 2026 (Trading Economics). The retreat has been orderly, with COMEX warehouse stocks continuing to build through May.

Why is COMEX trading at a premium to LME?

The COMEX-LME premium reflects two years of tariff-arbitrage flow that pulled metal into US-bonded storage ahead of Section 232 measures. COMEX stocks stood above 503,000 tonnes in mid-May 2026 against under 100,000 a year earlier — the most distorted segment of the global copper curve.

What do Goldman Sachs and JPMorgan forecast for 2026?

Goldman Sachs Research has the 2026 LME average at $12,650/tonne after an April 2026 trim from $12,850, drifting toward $12,000 in H2. J.P. Morgan Global Research projects $12,075/tonne for full-year 2026 against a 330,000-tonne refined deficit. The base case in this article sits above both at roughly $15,400/tonne LME equivalent.

What is the single biggest risk to the bullish call?

A China Caixin PMI sub-49 print for two consecutive months. The 2015 analogue — when a property-led credit pulse rolled over and LME copper fell from $6,500 to under $4,500/tonne in six months — is the historical case that breaks the call.

This article is informational analysis only and is not financial, investment, or trading advice. Foreign-exchange, commodity, and equity markets are highly volatile and can lose substantial value rapidly. Leveraged products carry total-loss risk and may exceed the initial margin posted. Past performance and historical correlations do not guarantee future results. Do your own research and consult a regulated financial adviser before making any investment decision.