Chile's Cochilco raises copper price forecast on improved global outlook

By Fabian Cambero

SANTIAGO, May 28 (Reuters) - Chile's state copper commission Cochilco raised its average copper price forecast for this year and next on Wednesday, citing an improved global outlook following a pause in the tariff war between the United States and China.

The commission increased its average price projection for both 2025 and 2026 to $4.30 per pound, up from a previous estimate of $4.25 in its February report.

In a press conference, Cochilco leadership expressed cautious optimism regarding copper prices, while acknowledging a tighter than expected global supply situation and strong demand fundamentals.

An agreement earlier this month between the U.S. and China to slash steep tariffs for at least 90 days "has significantly reduced trade barriers, easing tensions that were affecting confidence and the dynamism of global trade," Cochilco said.

Cochilco also sees continued support for copper prices from long-term trends like the energy transition and the expansion of electricity grids, electric vehicles and energy storage.

Production increased in the first quarter at Codelco, the world's largest copper producer, and Antofagasta Minerals ANTO.L. State-owned Codelco's COBRE.UL production grew 5.2% in April, Cochilco said.

Still, the domestic increases did not offset a global decline. Cochilco now expects global supply growth this year to be much lower than it previously forecast, at 1.3% from a prior estimate of 4.7%.

Victor Garay, Cochilco's mining market coordinator, said that in a practically balanced market, any supply disruption would directly affect the price.

Separately, the agency projected that Chilean copper production would increase by 3% this year and again in 2026, when it is expected to reach 5.84 million metric tons.

The production guidance reflects a downgrade from Cochilco's February estimate of 4.6% growth in 2025 and 3.6% growth in 2026.

Globally, Cochilco expects a copper deficit of 109,000 tons this year and a slight surplus of 19,000 tons for 2026, amid demand growth of 2.3% and 2.8%, respectively.