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Released September 26, 2025 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Researched by Industrial Info Resources (Sugar Land, Texas)--This week, Freeport-McMoRan (Phoenix, Arizona) declared force majeure for its Grasberg copper and gold mine in Indonesia. As Freeport's largest copper mine and the second-largest in the world, the closure has significantly affected price outlooks and supply forecasts for copper.
While Freeport officially declared force majeure for the mine on Wednesday, the closure stems from a September 8 incident in which, as Freeport describes, "a sudden rush of approximately 800,000 metric tons of wet material entered the mine and traveled rapidly to multiple mine levels." The incident resulted in two confirmed deaths, and five PT Freeport Indonesia workers remain missing.
In a press release announcing the force majeure, Freeport gave an expected timeline for the restart of the mine, which it doesn't expect to return to full production until 2027. The company plans on beginning a phased restart of two production blocks in the first half of 2026, another block in the second half of that year, with the balance of production returning to pre-incident levels in 2027. Subscribers to Industrial Info's Global Market Intelligence (GMI) Plant Database can click here for the plant profile.
While the loss of the mine's copper, used in everything from power lines to electric vehicles to wind turbines, is garnering the most press, the mine also is a substantial gold producer, accounting for 70% of Freeport's production of the valuable metal along with nearly 30% of its copper output. The mine's annual output before the incident was approximately 1.7 billion pounds of copper and 1.4 million ounces of gold. Freeport has updated its third-quarter guidance, expecting its sales of copper to be 4% lower and 6% lower for gold, compared to estimates made in July.
Freeport's official declaration of force majeure had an almost immediate effect on copper prices, which at one point Wednesday were up 2% on the London Metal Exchange to $10,172 per ton, the highest price on the exchange in more than 15 months.
The company's declaration and restart timeline have allowed analysts to alter their forecasts for both copper's price and production outlook, showing the global effects of the loss of Grasberg. Goldman Sachs estimated there will be a total loss of 525,000 metric tons of copper supply and reduced its global mine supply outlook for the second half of 2025 by 160,000 tons and by 200,000 tons in 2026. The bank shifted its predicted 2025 global copper balance from a surplus of 105,000 tons to a deficit of 55,500 tons, with a small surplus returning in 2026.
Citi revised its fourth-quarter copper price forecast to $10,500 per ton from a previous prediction of $10,000. But even higher prices are in store, Citi forecasts, predicting a 400,000-ton deficit for 2026, with prices rising in the next six to 12 months to $12,000 per ton in the bank's base case and as high as $14,000 per ton at the upper extreme.
The removal of such a substantial amount of copper from the market could lead to higher prices for things like power infrastructure. In the May release of its Global Critical Minerals Outlook 2025, the International Energy Agency (IEA) highlighted the important role copper plays in the energy transition as renewable forms of power generation are built and new power lines are needed to connect these facilities to the grid. Warning of a 30% global copper deficit by 2035 if no new production comes online, the agency wrote, "Disruptions in mineral supplies can have major impacts on technology prices, manufacturing competitiveness, inflation and the wider economy." The IEA especially highlighted the importance of copper, stating, "The supply gap for copper is particularly concerning due to declining ore grades, rising project costs and a sharp slowdown in new resource discoveries, all of which make bringing new supply online highly challenging."
With a major disruption in copper mining officially on the books, it remains to be seen how supply and demand for the metal plays out in the near future and how much prices may rise for the important products and infrastructure that require it.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
While Freeport officially declared force majeure for the mine on Wednesday, the closure stems from a September 8 incident in which, as Freeport describes, "a sudden rush of approximately 800,000 metric tons of wet material entered the mine and traveled rapidly to multiple mine levels." The incident resulted in two confirmed deaths, and five PT Freeport Indonesia workers remain missing.
In a press release announcing the force majeure, Freeport gave an expected timeline for the restart of the mine, which it doesn't expect to return to full production until 2027. The company plans on beginning a phased restart of two production blocks in the first half of 2026, another block in the second half of that year, with the balance of production returning to pre-incident levels in 2027. Subscribers to Industrial Info's Global Market Intelligence (GMI) Plant Database can click here for the plant profile.
While the loss of the mine's copper, used in everything from power lines to electric vehicles to wind turbines, is garnering the most press, the mine also is a substantial gold producer, accounting for 70% of Freeport's production of the valuable metal along with nearly 30% of its copper output. The mine's annual output before the incident was approximately 1.7 billion pounds of copper and 1.4 million ounces of gold. Freeport has updated its third-quarter guidance, expecting its sales of copper to be 4% lower and 6% lower for gold, compared to estimates made in July.
Freeport's official declaration of force majeure had an almost immediate effect on copper prices, which at one point Wednesday were up 2% on the London Metal Exchange to $10,172 per ton, the highest price on the exchange in more than 15 months.
The company's declaration and restart timeline have allowed analysts to alter their forecasts for both copper's price and production outlook, showing the global effects of the loss of Grasberg. Goldman Sachs estimated there will be a total loss of 525,000 metric tons of copper supply and reduced its global mine supply outlook for the second half of 2025 by 160,000 tons and by 200,000 tons in 2026. The bank shifted its predicted 2025 global copper balance from a surplus of 105,000 tons to a deficit of 55,500 tons, with a small surplus returning in 2026.
Citi revised its fourth-quarter copper price forecast to $10,500 per ton from a previous prediction of $10,000. But even higher prices are in store, Citi forecasts, predicting a 400,000-ton deficit for 2026, with prices rising in the next six to 12 months to $12,000 per ton in the bank's base case and as high as $14,000 per ton at the upper extreme.
The removal of such a substantial amount of copper from the market could lead to higher prices for things like power infrastructure. In the May release of its Global Critical Minerals Outlook 2025, the International Energy Agency (IEA) highlighted the important role copper plays in the energy transition as renewable forms of power generation are built and new power lines are needed to connect these facilities to the grid. Warning of a 30% global copper deficit by 2035 if no new production comes online, the agency wrote, "Disruptions in mineral supplies can have major impacts on technology prices, manufacturing competitiveness, inflation and the wider economy." The IEA especially highlighted the importance of copper, stating, "The supply gap for copper is particularly concerning due to declining ore grades, rising project costs and a sharp slowdown in new resource discoveries, all of which make bringing new supply online highly challenging."
With a major disruption in copper mining officially on the books, it remains to be seen how supply and demand for the metal plays out in the near future and how much prices may rise for the important products and infrastructure that require it.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
