Goldman Sachs lowered on Thursday its global copper mine supply forecast for 2025 and 2026 following a disruption at Indonesia’s Grasberg, the world’s second-largest copper mine.
The incident, which occurred on September 8, trapped workers underground due to heavy mud flow, prompting operator Freeport-McMoRan to declare force majeure.
The bank estimates there will be a total loss of 525,000 metric tons of copper mine supply as a result of the disruption, reducing its global mine supply forecast for the second half of 2025 by 160,000 tons and its 2026 forecast by 200,000 tons.
Grasberg’s production is now expected to fall by 250,000 to 260,000 tons in 2025 and by 270,000 tons in 2026.
Goldman said Freeport noted that fourth quarter 2025 production from Grasberg will be very low, as the unaffected areas of the mine could restart in the middle of the quarter. Goldman said the unaffected portion accounts for about 30 per cent-40 per cent of Grasberg’s annual production capacity.
The rest of the mine is expected to restart sometime in 2026, the bank said citing Freeport.
The production loss exceeds Goldman’s typical allowances for global supply disruptions, leading the bank to cut its estimates for global mine production growth for 2025 to 0.2 per cent higher than a year earlier, down from a previous forecast of 0.8 per cent, and in 2026 to 1.9 per cent, down from 2.2 per cent.
The disruption shifted Goldman Sachs’ 2025 global copper balance from a projected surplus of 105,000 tons to a deficit of 55,500 tons, though 2026 is expected to remain in a small surplus.
Goldman Sachs sees upside risks to its December 2025 London Metal Exchange copper price forecast of $9,700 a ton, suggesting prices could settle in the $10,200-$10,500 range.
The bank reaffirmed its long-term bullish copper price outlook of $10,750 a ton by 2027, citing challenges such as deeper mines, lower grades, and harder ore extraction, compounded by other disruptions this year at the Kamoa-Kakula and El Teniente mines.
The benchmark three-month copper price on the London Metal Exchange was trading at $10,277.50 a ton by 0310 GMT.
