U.S.-based mining company Freeport-McMoRan (FCX) on Wednesday (September 24, 2025) officially declared a force majeure condition at its Grasberg mine in Papua. The decision follows an incident involving a flow of wet material that blocked access to the Grasberg Block Cave (GBC) underground mine and trapped seven workers since Monday (September 8, 2025).
The announcement sent Freeport’s shares plunging by as much as 10.4%. FCX currently holds a 48.77% stake in PT Freeport Indonesia (PTFI).
Following the incident, all mining operations were temporarily suspended as the company focused its resources on rescue efforts. By Saturday (September 20, 2025), two of the seven missing workers had been found dead, while five others remain unaccounted for.
Citing Reuters on Thursday (September 25, 2025), Freeport projected that Grasberg operations would only be able to gradually restart in the first half of 2026. Production from its Indonesian unit is expected to decline by up to 35% next year. The situation is further complicated by the shutdown of a smelter project in Indonesia, which had been damaged by a fire last year.
The announcement also reverberated through global markets. Copper prices on the London Metal Exchange surged more than 3%, reaching their highest level in over 15 months. According to Jefferies analysts, while the production guidance revision was anticipated, the scale of the cut was larger than expected. “Supply disruptions will tighten the copper market, which could actually benefit Freeport’s operations in the U.S.,” one analyst noted.
Freeport now estimates consolidated third-quarter sales will fall by approximately 4% for copper and 6% for gold, compared to earlier forecasts of 1 billion pounds of copper and 350,000 ounces of gold.
Meanwhile, Goldman Sachs has also lowered its global copper supply projections for 2025–2026 due to the Grasberg disruption. They estimate that global supply will shrink by around 525,000 tons. Grasberg’s production alone is projected to decline by 250,000–260,000 tons in 2025 and a further 270,000 tons in 2026.
Freeport expects fourth-quarter 2025 production to be significantly below normal levels, as only parts of the mine unaffected by the incident will resume operations by mid-quarter, representing about 30–40% of annual capacity. The rest of the Grasberg mine is not expected to be operational until 2026.
Goldman Sachs stressed that this disruption exceeds the typical supply risks usually accounted for. As a result, global mining production growth for 2025 has been revised down to just 0.2% (from 0.8% previously), while 2026 growth is forecast to fall to 1.9% (from 2.2%). The global copper balance has also shifted, moving from a projected surplus of 105,000 tons in 2025 to a deficit of 55,500 tons. For 2026, only a slight surplus is expected.
