The industrial metal copper, indispensable for electronics and the global energy transition, has embarked on a historic bull run in 2025, mirroring the rallies seen in precious metals. Prices on the London Metal Exchange (LME) have advanced a staggering 41% so far this year, climbing to nearly $12,300 per ton and positioning the metal for its most significant annual gain since 2009.
Hindustan Copper: The Domestic Champion Riding the Wave
This sharp rally in global copper markets has electrified sentiment towards India's mining major, Hindustan Copper. The company, which holds approximately two-fifths of India's copper ore reserves and resources, stands to see its margins and revenue outlook expand significantly with rising prices. Reflecting this optimism, the Hindustan Copper share price surged another 9% in Friday's session on December 26 to reach ₹475.60, a level not witnessed since 2010.
This marked the stock's fourth consecutive session of gains, contributing to a 45.40% surge in December alone. From its September lows of ₹226.70 per share, the stock has staged a powerful comeback, soaring an impressive 110%. It has dramatically outpaced the broader benchmark indices and emerged as the top performer among Nifty Metal stocks this year.
Beyond the copper price rally, other positive catalysts for Hindustan Copper include a better-than-expected performance in the September quarter and strategic expansion plans. The company renewed its mining lease for the Rakha Copper Mine in Jamshedpur for another 20 years, paving the way for reopening and expansion. It also signed a memorandum of understanding (MoU) with Oil India to jointly explore and develop critical minerals, aligning with the government's National Critical Minerals Mission.
The company has ambitious plans to increase its mining capacity from the current 4.0 million tons per annum to 9.6 million tons per annum in phase I through the expansion of existing mines, reopening of closed mines, and opening of new mines.
Global Forces Driving the Copper Frenzy
The rally is not confined to Indian markets. The most active copper contract on the Shanghai Futures Exchange touched a record high of 98,590 yuan a ton, while COMEX contracts rose 3% to hit $5.743 a pound. The surge is driven by a potent mix of sustained demand and constrained supply.
Copper is crucial for electric vehicles, charging infrastructure, and renewable energy projects, all central to global decarbonisation efforts. This demand is compounded by the ongoing artificial intelligence boom, which requires vast amounts of the metal for data centers and electronics.
On the supply side, a series of accidents and disruptions at some of the world’s largest copper mines, particularly in Africa, have strained global supplies. Furthermore, concerns that the US could impose potential tariffs on the metal have triggered a scramble to move metal to US shores, threatening to leave the rest of the world undersupplied. A recent slump in the US dollar has provided an additional lift, making dollar-priced copper cheaper for holders of other currencies.
Analysts Bullish on Continued Rally
Financial institutions remain optimistic about copper's trajectory. Citigroup Inc. expects LME copper to hit $13,000 per ton, while Goldman Sachs Group Inc. recently flagged copper as its favoured metal for the year ahead. Global refined copper usage has more than tripled over the last 50 years, and this growth trend is expected to persist.
In contrast to this global demand, India's position in the copper landscape is modest. The country contributes only about 0.2% of global copper reserves. Its mining production accounts for a mere 0.12% of global output, while refined copper production stands at around 2% of worldwide production. This supply-demand imbalance within India further highlights the strategic importance of domestic players like Hindustan Copper in the nation's industrial and green energy ambitions.
