Deutsche Bank Warns of Historic Copper Squeeze Amid US-China Stockpiling and De-Globalization

London copper prices have approached record levels as analysts highlight unprecedented tightness in physical markets driven by strategic stockpiling. Deutsche Bank metals research head Daniel Ghali has warned that available global copper inventories have fallen to historic lows, with US and Chinese stockpiling potentially encumbering 71% of above-ground stocks by year-end. Ghali forecasts a roughly 50% rally to $22,050 per ton by Q2 2027, citing the combination of de-globalization, decades of underinvestment in supply, and policy-driven demand as creating an "acute copper scarcity on record."

This view aligns with broader market analysis. Reports confirm China's strategic reserves hold significant volumes equivalent to a large share of global inventories, while US tariff policies accelerate domestic warehousing. Other banks echo the bullish tone: J.P. Morgan projects prices reaching $12,500/mt in Q2 2026 amid persistent deficits; Goldman Sachs has raised targets citing supply disruptions at major mines; and Citi sees near-term upside toward $14,500-$15,000/ton. Visible exchange stocks are drawing down rapidly, shifting the narrative from AI-driven demand to a liquidity and access crisis.

The risk highlighted is a potential bidding war for remaining metal, with freely available inventories possibly nearing zero by late 2028 absent demand destruction or higher prices. This "de-globalization endgame" underscores vulnerabilities in critical materials supply chains essential for electrification, defense, and infrastructure.