Beneath the Surface
Pablo Hill: An Unmistakable Pattern in Copper
December 8, 2025 • 3 minute, 28 second read
“Copper continues to be unstoppable.”
– Leonardo Suarez
Copper’s price soars as investors rediscover the metal’s utility
December 8, 2025 — In the late 1970s, Texas oilmen Nelson and William Hunt attempted one of the boldest commodity plays in modern history.
By accumulating 200 million ounces of physical silver and layering on massive futures positions, they tried to corner the market.
Their theory was simple: create scarcity, trigger a squeeze, and let global prices rise under their control.
For a brief moment, the plan worked. Silver rocketed to $50 per ounce in early 1980 as traders scrambled for metal. But instability drew government intervention, liquidity vanished, and the Hunts were forced to unwind their positions.
The collapse was swift.
The episode remains instructive because it demonstrated how quickly a commodity market can be reshaped when one actor becomes the marginal buyer.
The Hunts failed, but they revealed the underlying physics of market power: whoever can pull physical supply toward themselves shapes global price, liquidity, and narrative.
That lesson is resurfacing today, only on a global scale, and the commodity at the center of it is not silver but copper.
The world’s monetary order is not ultimately anchored by interest rates or policy guidance but by the materials that civilization cannot function without.
Economists debate models; commodity traders count barrels, tons, and ships. Power belongs to the nation capable of attracting and absorbing strategic resources.
China spent more than a decade building such influence through the Shanghai Gold Exchange, using domestic premiums to pull gold from West to East.
The United States has now developed its own gravitational pull, not through decree but through incentives embedded in policy and markets. The mechanism is arbitrage, and the metal being drawn in is copper.
In late 2025, copper began behaving like money. Prices broke out of their post-Thanksgiving range and surged to an all-time high of $11,294.50 per ton on the London Metal Exchange. COMEX futures in New York rose sharply at the same time, widening the spread between U.S. and London pricing as traders rushed to ship physical metal into the United States ahead of new tariff threats.
The pattern was unmistakable: a new price center was forming.
As copper flowed into the United States, LME inventories thinned and backwardation steepened. Higher U.S. pricing, tariff protection, and lower political risk made American warehouses the most attractive destination for metal. Each new shipment strengthened the spread.
The arbitrage, once triggered, became self-reinforcing. Traders were not participating in theory; they were responding to the physical incentives in front of them.
The United States had quietly become the marginal buyer of the world’s most important industrial metal. China, long the gravitational center of global copper demand, found itself on the outside.
CESCO data presented in Shanghai showed Chinese demand weakening quarter-to-date despite modest year-to-date growth, but the specifics barely mattered. Copper was moving west.
Pablo Hill
The Monetary Skeptic & Grey Swan Investment Fraternity
P.S. from Addison: Pablo’s with Grey Swan contributor, Shad Marquitz, who has been long and strong copper for several years during the build-out of data centers for AI.
The metal should benefit as demand grows globally and remain in high gear. Paid-up Fraternity members can read Shad’s insights surrounding the commodity markets in the latest monthly Grey Swan Bulletin.
As Shad mentioned explicitly in our November issue:
Thus far, the diagnosis of the economy by Doctor Copper has been spot on, because the economy didn’t fall apart and go to hell-in-a-hand-basket in 2022, 2023, 2024, or thus far in 2025.
Copper continues to be a good measuring stick for economic growth around the world, and the supply/demand fundamentals remain structurally bullish on the red metal for the next few years and beyond.
After a strong move higher this year in gold, silver, and copper, the metals are taking a necessary breather before they can push to new highs.
We’ll see what the final month of the year – and 2026 brings – for all commodities, including copper. We expect further upside.
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