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Copper Rises as Chile Mine Disruptions Add to Supply Risk
Copper prices moved higher on October 12 as a fatal landslide partially halted operations at Codelco’s El Teniente mine and a strike continued at Antofagasta’s Centinela operation, adding fresh pressure to a Chilean supply picture already weakened by lower national production.
By Paul Ploumis
Published October 12, 2026
Key Points
- LME copper: ↑0.3% to about US$14,585 per metric ton in Monday trading.
- SHFE copper: ↑0.9% to CNY 110,630 per metric ton.
- El Teniente: Operations in the south pit were suspended after a landslide killed two contract workers.
- Centinela: A strike continues, with voluntary mediation scheduled to resume October 13.
- China import signal: The Yangshan copper premium reached US$135/MT, its highest level in four years.
- SHFE inventories: Rose to 58,744 tonnes, up about 20,000 tonnes from the end of September.
SEATTLE (Scrap Monster): Copper prices edged higher Monday as two supply disruptions in Chile kept near-term availability in focus.
Benchmark three-month copper on the London Metal Exchange rose about ↑0.3% to US$14,585 per metric ton, while the most-traded Shanghai Futures Exchange copper contract gained ↑0.9% to CNY 110,630 per metric ton.
The gains followed a strong finish to the previous week, when copper advanced amid mine-supply concerns, signs of active Chinese buying and tight visible inventories outside the United States.
ScrapMonster Exclusive: Two Mines Explain Why Chile Headlines Move Copper So Quickly
El Teniente and Centinela are individually large enough to matter to the global copper balance. El Teniente produced approximately 310,000 tonnes of copper in 2025, while Centinela produced 240,400 tonnes.
Together, the two operations produced about 550,400 tonnes last year. For perspective, that volume is equivalent to roughly 10.4% of Chile’s forecast 5.27 million tonnes of copper production for 2026.
That does not mean 550,400 tonnes are currently threatened. Codelco has suspended only the affected south-pit area at El Teniente, while Antofagasta has said its production guidance remains unchanged despite the Centinela strike.
The comparison instead explains the market sensitivity. When operational problems emerge simultaneously at two mines of this scale in the world’s largest copper-producing country, traders have to account for the possibility that seemingly localized disruptions could become meaningful if they persist.
That concern is amplified by Chile’s already weak production backdrop. Chile produced only 369,500 tonnes of copper in August, down 13% year over year and the country’s lowest monthly output in more than 15 years. Cochilco expects full-year 2026 output to fall 2.6% to 5.27 million tonnes.
Fatal Landslide Partially Halts El Teniente
Codelco partially suspended operations at its El Teniente copper mine after a landslide struck the south-pit area on October 11.
Chile’s mining regulator, SERNAGEOMIN, said three contract workers from Aura Ingeniería were inspecting the area when the landslide occurred.
One worker was rescued, while two others were later found dead.
Codelco said heavy rainfall in central Chile triggered the landslide. Authorities suspended operations in the south-pit sector while investigations into the accident continued.
El Teniente, located about 75 kilometres southeast of Santiago, is one of Codelco’s largest operations and contains more than 4,500 kilometres of underground tunnels and galleries.
The mine produced approximately 310,000 tonnes of copper in 2025.
Centinela Strike Continues as Talks Resume
A separate supply risk remains at Antofagasta Minerals’ Centinela mine in northern Chile.
Workers represented by the Minera Esperanza and Distrito Centinela unions began striking on October 7 after government-mediated contract negotiations failed to produce an agreement.
The two unions represent 708 workers and include more than half of Centinela’s critical mine operators and more than 60% of equipment-maintenance employees.
Centinela and the unions are scheduled to resume negotiations on October 13 under a voluntary mediation process proposed by regional labour authorities.
Antofagasta has said operations have continued during the strike and has maintained its production guidance.
The unions, however, have warned that the impact could become more significant if the strike continues. They estimate production could fall by as much as half in November as waste-rock removal and other mine activities are increasingly affected.
Centinela produced 240,400 tonnes of copper in 2025, up 7% from the previous year.
China Copper Import Premium Hits Four-Year High
The supply concerns are arriving as physical-market indicators point to strong demand for imported copper in China.
The Yangshan copper premium ended last week at US$135 per metric ton, its highest level in four years.
The Yangshan premium measures what buyers are willing to pay above benchmark prices to secure imported copper into China.
A rising premium generally signals stronger competition for immediately available imported metal.
The latest increase followed China’s return from the week-long National Day holiday and suggests physical buyers were active despite copper prices remaining historically elevated.
Why Rising SHFE Stocks Do Not Necessarily Signal Weak Demand
At the same time, copper inventories in warehouses monitored by the Shanghai Futures Exchange rose to 58,744 tonnes.
That represents an increase of about 20,000 tonnes, or roughly 51.6%, from the end of September.
At first glance, rising exchange inventories may appear inconsistent with a four-year-high import premium. The two indicators, however, measure different parts of the market.
Imported copper can enter exchange or bonded warehouses before being sold or consumed downstream. Metal can also be held temporarily for financing, arbitrage or logistics reasons.
For that reason, rising stocks do not automatically mean physical demand has weakened.
| China Copper Indicator | Latest Reading | What It Suggests |
|---|---|---|
| Yangshan Premium | US$135/MT | Strong demand for imported physical copper. |
| SHFE Inventories | 58,744 tonnes | More metal has entered exchange-monitored warehouses. |
| Change From End-September | ↑51.6% | Inventory rebuilding after exceptionally low late-September stocks. |
Nearby Copper Availability Is Becoming More Important
The combination of mine disruptions and strong physical-market premiums can increase sensitivity in the front end of the copper futures curve.
Nearby spreads measure the price difference between copper available for earlier delivery and contracts for delivery further into the future.
When immediately available metal becomes scarce, nearby contracts can trade at increasingly large premiums to later-dated contracts.
The LME cash copper contract recently traded at a sizeable premium to the three-month contract, another indication that immediately deliverable metal remains valuable even where total global inventories may appear adequate.
U.S. Copper Stockpiles Add Another Layer to the Market
The geographic distribution of copper inventories is also increasingly important.
Large quantities of copper have moved into the United States during the past 18 months as the premium between U.S. CME copper prices and international markets encouraged metal into American warehouses.
Reuters estimates that commercial copper inventories in the United States now exceed one million tonnes when exchange and off-market stocks are included.
That means global copper supply is not only about the total quantity of metal available, but also where that metal is located and whether it can economically move to the regions that need it.
Chile’s Copper Production Was Already Under Pressure
The latest mine disruptions arrive during an unusually weak year for Chilean copper production.
Chile produced 369,500 metric tonnes of copper in August, down 13% from a year earlier and approximately 8% from July.
It was the country’s weakest monthly production result since February 2011.
Chile’s copper commission, Cochilco, expects national mine output to decline 2.6% in 2026 to approximately 5.27 million tonnes.
Cochilco has attributed the weaker outlook partly to lower production from Codelco and BHP operations during an exceptionally weak first half of the year.
The agency expects a partial recovery during the second half, including improved production at El Teniente, making any fresh disruption at that operation particularly relevant to the national outlook.
What to Watch Next
El Teniente restart: The duration and geographic scope of the south-pit suspension will determine whether the landslide has a material production impact beyond the immediate area.
Centinela mediation: Voluntary talks resume October 13. An agreement could quickly reduce one source of supply risk, while a prolonged strike could increase the production impact.
Yangshan premium: A premium holding near or above US$135/MT would signal continued competition for imported copper in China.
SHFE inventories: Further inventory accumulation should be read together with import premiums and downstream buying rather than treated as an isolated bearish signal.
LME nearby spreads: Wider cash premiums would indicate increasing competition for immediately deliverable copper.
Chile production: With national output already projected to fall in 2026, additional operational disruptions could make Cochilco’s expected second-half recovery harder to achieve.
ScrapMonster Market Read: Copper’s latest move is being driven by more than a single mine headline. Chile is entering these disruptions from an already weak production base, while China is paying the highest import premium in four years for physical copper. Rising SHFE stocks complicate the picture but do not negate that demand signal. The key risk is increasingly geographic: substantial copper may exist globally, but immediately deliverable metal in the right market remains valuable. That is why developments at El Teniente and Centinela are having an outsized impact on near-term copper pricing.
Sources: Codelco; SERNAGEOMIN; Antofagasta PLC; Cochilco; Reuters.
