Aurubis CEO expects US copper demand to reduce Comex stockpile

Aurubis CEO Toralf Haag said the 532,000 metric tons of copper in U.S. Comex warehouses should decline over the coming months as local demand absorbs stockpiles built ahead of possible tariffs. The company expects to complete the 90,000 tons-per-year second phase of its Richmond, Georgia recycling plant by end-September, while a broader U.S. expansion decision is now likely by end-2026. Aurubis also cited softer demand from the Iran war and Germany’s automotive slump, partly offset by power, construction, data center, and sulphuric acid demand.

Analysis

The key setup is not “higher copper prices” per se, but a potential unwind of a highly distortive U.S. inventory overhang that has been suppressing regional pricing power and distorting trade flows. If stocks bleed down as domestic demand absorbs metal, the marginal buyer becomes the U.S. consumer, not the import arbitrageur — that typically tightens nearby spreads before it shows up in headline global benchmarks. The second-order effect is that producers with North American downstream exposure should see margin stability even if ex-U.S. demand remains uneven.

The more important medium-term catalyst is capacity optionality. A recycling expansion, a second U.S. recycling site, or a primary smelter would all be capital allocation decisions that imply confidence in structurally tighter North American supply, but the timing slip to late 2026 tells you management is waiting for clearer evidence that the local supply/demand balance is durable. That delay creates a tradable window: the market may front-run an investment cycle before capex actually lands, especially if data-center and grid-related demand keeps compounding.

The contrarian risk is that the inventory draw thesis is slower than consensus expects. If tariffs remain a political overhang and the Comex arb reopens intermittently, warehouse stocks can stay elevated for longer than fundamental users assume, keeping regional copper prices from fully reflecting the shortage narrative. In that scenario, the cleaner trade is not to chase the metal itself but to own beneficiaries of infrastructure and electrification demand where pricing power is less dependent on spot copper tightness.

For suppliers of sulfuric acid, the conflict-driven shortage is a side channel worth watching because it can become a high-margin byproduct lever even when copper processing economics are only modestly improving. This is one of those situations where the immediate market focus is on metal, but the real earnings surprise may come from ancillary chemicals and service revenue tied to smelting throughput.

Key Decisions for Investors

• Go long FCX on a 3-6 month horizon against a short in a broad industrials ETF: if U.S. copper inventories draw down as expected, North American pricing spreads should tighten before global benchmark copper rerates; target 15-20% upside, stop on renewed Comex stock build.
• Add to U.S. electrical infrastructure beneficiaries such as PWR or NVT over the next 1-3 months: these names capture copper demand indirectly without taking outright commodity beta, and should outperform if data-center/grid demand remains the cleaner growth vector.
• Initiate a pair trade: long copper-equipment / electrification exposure, short auto OEMs with weak European mix (e.g., STLA) for 6 months — the article implies industrial and power demand can offset auto weakness, so the relative winner is the electrification chain, not legacy autos.
• Use FCX or SCCO call spreads into any pullback over the next 4-8 weeks: the risk/reward is attractive if the market begins pricing in a 2H inventory draw, but capped risk is appropriate because the arb can reopen and delay the move.
• Avoid chasing pure copper ETF longs here; prefer staged entry only if Comex stocks begin falling sequentially for 4+ weeks, since the trade is more about inventory normalization than a sudden global demand shock.