Europe's biggest copper smelter, Aurubis, will charge customers a record $347 a tonne above LME prices next year, up 10%, three market sources told Reuters, as tight supply and US tariff fears keep European copper scarce.
At a glance
- The 2027 premium is up from $315 a tonne this year.
- Aurubis expects very strong demand from AI data centres, electric vehicles and renewable energy.
- Treatment charges that miners pay smelters have fallen to historic lows, even below zero.
Background
Copper buyers pay the London Metal Exchange (LME) price plus a premium that reflects delivery costs and how tight the local market is. Annual premiums set by big producers such as Germany's Aurubis and Chile's Codelco are closely watched as a gauge of physical demand for the coming year.
What happened
Aurubis will charge a premium of $347 a metric ton for refined copper in Europe in 2027, three market sources said on Wednesday, Reuters reported. That is 10% more than its 2026 premium of $315 and a record for the German company. Fastmarkets also reported the increase.
Aurubis declined to comment on the figure. A spokesperson said the company expects "a very strong demand side" in 2027, driven by AI data centres, electric vehicles and renewable energy.
Why the premium is rising
European supply is expected to stay tight next year, after large volumes of copper were shipped to the US ahead of possible import tariffs. Low LME inventories and labour unrest in Chile have added to supply worries.
Smelters are also squeezed at the other end. Treatment and refining charges are the fees miners pay smelters to turn concentrate into metal. They have collapsed to historic lows and even turned negative, because of smelter overcapacity in China and tight mine supply. Albert Mackenzie of Benchmark Mineral Intelligence said the rise was in line with expectations, given low treatment charges and continuing tariff speculation.
What it means
A higher premium adds to the total cost European manufacturers pay for copper. The LME benchmark hit a record $14,875 a ton on September 10 and was trading around $14,650, up 17% this year.
Mackenzie said it will be worth watching whether Codelco's premiums, especially in Asia, follow the increase. Supply risks in Chile may ease slightly: two sources told Reuters on Wednesday that Escondida's supervisors' union and BHP had reached a preliminary agreement.
Our read
Outlook: bullish. A record physical premium signals strong demand and tight supply in Europe. A confirmed Escondida deal could ease some of the pressure.
What to watch
- Whether Codelco raises its 2027 premiums, especially for Asian buyers.
- Whether the preliminary deal at Escondida is confirmed.
- Any US decision on copper import tariffs.
For information only, not investment advice.
Copper price in India
metalscost.com India reference price as of 2026-10-16.
Detailed analysis
Timeline
- 2026-09-10: LME copper hits a record $14,875 a ton.
- 2026-10-14: Sources say Aurubis sets a record 2027 European premium of $347 a ton.
Demand Drivers
Aurubis expects strong demand from data centres, electric vehicles and renewable energy.
Supply Drivers
Copper shipped to the US ahead of tariffs and low LME stocks keep European supply tight.
Trade Tariffs
Speculation about US copper import tariffs is still pulling metal away from Europe.
What could lift prices
- Record premiums point to strong physical demand.
- Low treatment charges show mine supply remains tight.
What could weigh on prices
- A preliminary deal at Escondida could ease Chilean supply fears.
- Higher costs could make some European buyers cut orders.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Germany | Medium | Home to Aurubis, Europe's biggest copper smelter. |
| United States | Medium | Tariff fears have drawn copper away from Europe to the US. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Copper Smelting & Refining | Positive | A higher premium helps smelters offset very low treatment charges. |
| Electrical Equipment Manufacturing | Negative | European manufacturers will pay more for refined copper. |
Who gains, who loses
- Aurubis: It earns more on each tonne of copper sold in Europe.
- European copper users: They face a record premium on top of high LME prices.
Other ways this could play out
- If Codelco matches the rise, higher premiums could spread to Asian buyers.
- If US tariff fears fade, copper could flow back to Europe and ease premiums.
Price risks
- A confirmed Escondida deal could cool supply worries.
- Weaker European industrial demand could undercut the premium.
Technical view
Price is mixed relative to its 20-period and 50-period moving averages, showing no clear trend alignment.
Computed from metalscost.com's own stored price history.
Germany
United States