Summary
The global Copper crisis intensified as major financial institutions, including UBS, dramatically raised their forecasts, predicting copper will hit an unprecedented $13,000 per tonne in 2026. This extreme bull scenario is driven by acute supply deficits and soaring demand from AI and electrification. Simultaneously, Canada is significantly expanding the strategic scope of its critical minerals policy, adding a dozen minerals to the exploration tax credit list and easing eligibility rules for tax credits on polymetallic projects. The $53 billion Teck-Anglo American merger heads toward its final shareholder vote on December 9th, with the outcome seen as crucial for leveraging scale to manage the immense volatility now dominating the copper market.
Key Points
UBS Raises Copper Price Forecast to $13,000/tonne for December 2026
The acute global copper supply shortage prompted UBS to significantly raise its price forecasts, introducing a new target of $13,000 per tonne for December 2026. This bullish outlook is based on a massive widening of the market deficit, now projected to hit 407,000 tonnes in 2026 (up from a previous forecast of 87,000 tonnes). UBS cites persistent mine disruptions (Grasberg, Chile, Peru) and robust structural demand from EVs, renewable energy, and data centers as the key drivers.
Canada Expands Critical Mineral Scope to Support Polymetallic Projects
Canada's Budget 2025 proposed significant expansions to its critical minerals policy to better reflect the geology of Canadian deposits:
Exploration Tax Credit (CMETC) Expansion: Eligibility for the 30% tax credit is proposed to be broadened, adding 12 new minerals including Tungsten, Germanium, Niobium, and Tantalum.
Manufacturing Tax Credit Easing: The eligibility threshold for the Clean Technology Manufacturing Investment Tax Credit (CTM-ITC) is proposed to be lowered from $90\%$ of production to $50\%$, allowing polymetallic mines (which produce critical minerals plus profitable byproducts like gold/silver) to qualify.
Teck/Anglo Merger Accelerates Toward December 9 Shareholder Vote
The $53 billion merger between Teck Resources and Anglo American PLC is now speeding toward the decisive shareholder vote scheduled for December 9, 2025. The deal, which recently cleared Canada's national security review, is widely supported by both boards to create a combined entity that will be a top-five global copper producer. The transaction's primary remaining hurdle is the final "net economic benefit" review by the Canadian government, which is demanding strong commitments on Canadian domicile, jobs, and processing capacity.
UK Launches New Critical Minerals Strategy: Vision 2035
The UK government launched its long-term Critical Minerals Strategy – Vision 2035, setting out ambitions to secure critical minerals supply over the next decade. The strategy focuses on two key objectives: optimizing domestic production (including tungsten and lithium in Cornwall) and building resilient global supply networks. The UK government committed up to £50 million in direct funding for critical mineral projects in the UK, alongside utilizing its finance and academic sectors (like the City of London and Camborne School of Mines) to enhance international partnerships.
Why It Matters
Copper is Now a Macro-Risk
The $13,000/tonne forecast signals that the copper deficit is no longer just a mining sector issue; it is a macroeconomic risk for the entire global energy transition. Higher copper prices will inflate the cost of every EV, wind turbine, solar farm, and data center built, threatening to slow decarbonization goals. This reinforces the necessity of government intervention (like the U.S. Critical Mineral List and Canada's CMIF funding) to accelerate domestic supply.
Canada Embraces Polymetallic Reality
Canada's decision to lower the tax credit eligibility threshold to $50\%$ for critical mineral production is a major policy win for the mining industry. It finally recognizes the geological reality that most Canadian deposits are polymetallic (producing multiple metals). This change de-risks financing for complex projects that co-produce critical minerals (like Copper, Zinc, Tungsten, and Germanium) alongside traditional byproducts (Gold, Silver).
UK Joins the Industrial Policy Race
The UK's Vision 2035 strategy confirms that industrial nations globally are moving from general rhetoric to targeted public funding and specific policy goals to secure supply. The UK is betting on its financial hub (City of London) and expertise in recycling and midstream processing to become a key player in the allied supply chain, despite its limited domestic mining endowment.
Watchlist Companies
Company / Entity | Context | Homepage / Link |
Teck Resources (TECK) | Merger decision on Dec 9; final government approval hinges on Canadian economic benefits. | |
Anglo American PLC (AAL) | U.K. miner aiming to complete the Teck merger; must satisfy Ottawa's sovereignty demands. | |
Foran Mining Corp. (FOM) | Developer of the McIlvenna Bay polymetallic project; direct beneficiary of Canada's new tax credit rule. | |
DLP Resources Inc. (DLP) | Canadian copper/molybdenum explorer presenting at the Virtual Investor Conference; benefiting from bullish copper forecasts. | |
Cornish Lithium | UK lithium developer in Cornwall; direct beneficiary of the UK's new Vision 2035 strategy and associated funding. | |
Ramaco Resources (METC) | U.S. REE/Critical Minerals producer; its coal byproduct strategy aligns with new US/UK focus on unconventional sources. |
Critical Minerals Spotlight
Copper — Supply Crisis: Forecasts of $\mathbf{\$13,000/\text{tonne}}$ confirm the immediate urgency of the global supply deficit, threatening to derail energy transition timelines.
Polymetallic — Canadian Policy: The new $\mathbf{50\%}$ tax credit rule unlocks financing for complex Canadian deposits containing multiple critical and base metals.
UK — Processing Hub: The Vision 2035 strategy focuses on leveraging the UK's financial and processing expertise to create a hub for allied supply chains.
Action Points
Monitor Teck Shareholder Vote: Closely follow the December 9th vote; a positive result shifts full pressure to the Canadian government's final economic decision, which remains the key market risk event.
Recalculate Polymetallic NPVs: Canadian miners with polymetallic deposits (e.g., Copper-Zinc-Gold) should immediately recalculate their project economics based on the new $50\%$ CTM-ITC eligibility and the $\$13,000$ copper price forecast.
Evaluate UK Partnership: Canadian and Australian developers should explore partnerships with UK finance and processing groups, leveraging the new $\mathbf{£50 \text{ million} \text{ UK} \text{ funding}$ and its focus on midstream processing.
This briefing is for informational purposes only and is not legal, investment or policy advice. Information is believed accurate at the time of publication; sources are publicly available.
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