By Charles Pitts
SANTIAGO : Severe winter storms and unyielding blizzards across Chile have paralyzed key copper operations in the high Andes, compounding a fragile global supply crunch and driving benchmark metal prices near historic highs.
The extreme weather system, which has claimed 13 lives across the country over the past week, forced major miners to suspend or curtail operations in the world’s leading copper-producing nation. Chile accounts for more than 20% of global copper production, making any regional disruption an immediate catalyst for international markets.
Antofagasta suspended mining and processing operations at its flagship Los Pelambres mine as heavy snowfall and high winds blocked access roads and strained regional infrastructure. Meanwhile, Lundin Mining’s Caserones operation was forced to halt on July 18 after heavy snowfall severely damaged high-voltage power lines. Lundin reported that full grid restoration and a gradual restart could take two to three weeks.
State-owned Codelco also suspended several vulnerable high-altitude operations, while Barrick evacuated non-essential employees from its cross-border projects as avalanche risks escalated.
The physical shutdowns hit a market already grappling with acute deficits. London Metal Exchange (LME) copper prices hovered near record highs at approximately $13,750 per metric tonne, while COMEX contracts traded near $6.50 per pound.
Supply vulnerability has intensified across global exchanges. LME inventories have plunged 40% since mid-April, punctuated by an additional 10,000-tonne drop this week. Market dynamics show that 64% of visible global inventories are now concentrated in the United States, leaving European and Asian hubs severely depleted. Combined LME and Shanghai Futures Exchange (SHFE) inventories remain well below five-year averages.
“The concentration of stocks in US warehouses combined with sudden weather shocks in South America creates an exceptionally brittle market,” said Ewa Manthey, commodities strategist at ING. “Even temporary production stoppages in Chile reverberate instantly through global supply chains.”
The cascading disruptions prompted Chilean regulatory bodies to downgrade the country’s full-year 2026 copper output forecast by 2%, trimming expectations to 5.3 million tonnes. Analysts warn that structural headwindssuch as declining ore grades and rising operational complexities: will make recovering lost winter tonnage challenging during the second half of the year.
“While weather-related stoppages are historically factored into annual mine planning, the timing here couldn’t be worse for tight refined metal balances,” noted Natalie Scott-Gray, senior metals analyst at StoneX. “Inventories simply do not have the buffer to absorb multi-week outages without severe price volatility.”
As weather conditions gradually ease in central Chile, operators are mobilizing maintenance crews to inspect damaged transmission infrastructure and clear mountain passes. For further insights on how these supply disruptions intersect with broader global trends, visit Skillings Mining Intelligence. However, until power is fully restored at Caserones and port shipments resume normal cadence, the global copper market remains highly sensitive to any further operational friction.
