In a move that highlights the delicate balance between record-breaking commodity prices and operational volatility, Ninety One UK Ltd, a subsidiary of global asset manager Ninety One plc (LON:N91), has reduced its exposure to copper giant Freeport-McMoRan Inc. (NYSE: FCX). According to recent regulatory filings, the firm offloaded 879,341 shares of the mining heavyweight during the latter half of 2025. This divestment comes at a pivotal moment for Freeport-McMoRan, as the company navigates the dual realities of a historic copper "supercycle" and significant internal disruptions at its most critical mining site.
The sale by Ninety One UK Ltd represents a strategic trimming of a high-performing asset rather than a wholesale exit. Despite the sale, the firm retains a substantial stake of over 4.5 million shares, signaling a continued belief in the long-term fundamentals of the copper and gold markets. However, the timing of the move—following a catastrophic operational incident at Freeport’s Grasberg mine and amidst a flurry of securities litigation—suggests that institutional investors are becoming increasingly wary of the execution risks inherent in large-scale mining operations, even as the global demand for "green" metals reaches unprecedented levels.
Navigating the Grasberg Crisis: A Timeline of Volatility
The decision by Ninety One UK Ltd to sell nearly 880,000 shares was disclosed in a Form 13F filing on November 14, 2025, covering the third quarter of the year. During this period, Freeport-McMoRan experienced one of its most turbulent quarters in recent history. On September 8, 2025, a massive mudslide at the Grasberg Block Cave mine in Indonesia—the world’s largest gold mine and second-largest copper mine—resulted in seven fatalities and forced the company to declare force majeure. This event halted underground mining operations at the site, which accounts for a significant portion of the company’s annual production.
Despite this operational disaster, Freeport-McMoRan surprised the market on October 23, 2025, by reporting third-quarter earnings that beat analyst expectations. The company posted an adjusted earnings per share (EPS) of $0.50, outperforming the consensus estimate of $0.41. This financial resilience was almost entirely due to the skyrocketing price of copper, which averaged $4.68 per pound during the quarter. By the end of 2025, copper prices surged further to a record range of $5.65 to $5.72 per pound, driven by the insatiable demand for power infrastructure to support Artificial Intelligence (AI) data centers and the ongoing global transition to electric vehicles (EVs).
The institutional reaction to these events has been mixed. While the earnings beat provided a temporary boost to the stock, the long-term implications of the Grasberg shutdown and the resulting legal fallout have weighed on investor sentiment. As of January 1, 2026, several law firms, including The Rosen Law Firm and Faruqi & Faruqi, have initiated class-action lawsuits against Freeport-McMoRan, alleging that the company misled investors regarding its safety protocols and operational stability prior to the September mudslide. The deadline for lead plaintiffs to join these suits is January 12, 2026, creating a cloud of litigation risk that likely influenced Ninety One’s decision to lock in profits.
Winners and Losers in the Copper Supercycle
The immediate "loser" in this scenario is Freeport-McMoRan’s short-term stock stability, as institutional selling of this magnitude can create downward pressure. Furthermore, the company faces the challenge of a leadership transition during a crisis. On December 1, 2025, A. Cory Stevens assumed the role of President and COO of Freeport Americas, tasked with stabilizing operations while the main Grasberg Block Cave remains offline. The company does not expect a full restart of the Block Cave until the second quarter of 2026, leaving a multi-month gap in its production profile that competitors are eager to fill.
On the winning side, rival mining giants such as Southern Copper Corporation (NYSE: SCCO) and BHP Group Limited (NYSE: BHP) have benefited from the supply tightening caused by Freeport’s force majeure. With global copper inventories at multi-year lows and demand surging, companies with stable production in South America and Australia have seen their valuations soar. Additionally, Rio Tinto Group (NYSE: RIO) has positioned itself as a primary beneficiary of the copper deficit, leveraging its Oyu Tolgoi project in Mongolia to capture market share while Freeport works through its Indonesian recovery.
For Ninety One UK Ltd and other institutional sellers, the "win" is the realization of significant capital gains. With gold trading at an all-time high of over $4,300 per ounce and copper up 43% for the year 2025, trimming positions allows these firms to rebalance portfolios that have become overweight in the materials sector. This capital is likely being rotated into other areas of the energy transition value chain, such as lithium or specialized semiconductor firms that are less exposed to the geological risks of deep-earth mining.
The AI Factor and the Wider Significance of Copper
The sale of Freeport shares by a major institutional player like Ninety One UK Ltd is emblematic of a broader trend in the market: the decoupling of commodity prices from individual mining company performance. We are currently witnessing a "Copper Supercycle" that is no longer just about electric cars; it is about the massive electrical infrastructure required to power the AI revolution. Data centers are incredibly copper-intensive, and as of early 2026, the structural deficit in the copper market is estimated to be at its widest point in a decade.
This event also underscores the increasing importance of Environmental, Social, and Governance (ESG) factors in institutional decision-making. The fatalities and environmental impact of the Grasberg mudslide have put Freeport-McMoRan under a microscope. In the current regulatory environment, institutional investors are often mandated to reduce exposure to companies that suffer major safety lapses or environmental disasters. This "ESG-driven divestment" can occur even when the financial outlook for the underlying commodity remains bullish.
Historically, events like the Grasberg shutdown have served as a catalyst for industry-wide safety reforms. Similar to the fallout from the Brumadinho dam disaster in 2019, which affected Vale S.A. (NYSE: VALE), the Freeport incident is expected to lead to stricter international standards for underground mining and tailings management. For the broader market, this means higher compliance costs and longer lead times for new mining projects, further exacerbating the supply shortage and keeping metal prices elevated for the foreseeable future.
Looking Ahead: The Road to Q2 2026
The next six months will be critical for Freeport-McMoRan as it attempts to move past the Grasberg crisis. The primary milestone for investors to watch is the scheduled restart of the Block Cave in the second quarter of 2026. If the company can meet this timeline without further safety incidents, it will likely see a significant re-rating of its stock, especially if copper prices remain near their current record highs. Any delay in this restart, however, could trigger further institutional selling and embolden the ongoing class-action litigation.
Strategically, Freeport may need to pivot toward diversifying its production base to reduce its reliance on the Grasberg complex. While the company has significant assets in North and South America, Grasberg remains its "crown jewel." Analysts expect the company to increase its exploration budget in Arizona and Chile throughout 2026, seeking to bring smaller, more stable projects online to mitigate the impact of future disruptions in Indonesia. The market will also be watching for any potential M&A activity, as Freeport may look to acquire mid-tier producers to shore up its production guidance.
Final Assessment: A High-Stakes Balancing Act
The sale of 879,341 shares by Ninety One UK Ltd is a clear signal that even in a raging bull market for metals, execution and operational safety remain paramount. For Freeport-McMoRan, the current environment is a paradox: the company is generating massive cash flow from record metal prices, yet it is simultaneously fighting a multi-front battle against operational shutdowns, legal challenges, and leadership transitions. The earnings beat in late 2025 proved that the "Copper Supercycle" can mask many flaws, but institutional investors are signaling that they will not ignore those flaws forever.
Moving forward, the mining sector will continue to be defined by the tension between the world's desperate need for copper and the increasing difficulty of extracting it safely and sustainably. Investors should remain focused on Freeport’s ability to navigate its legal hurdles and the Q2 2026 restart of the Grasberg Block Cave. While the macro-economic tailwinds for copper and gold are the strongest they have been in a generation, the Ninety One sale serves as a reminder that in the world of mining, the "ground truth" of operations can be just as influential as the ticker tape on Wall Street.
This content is intended for informational purposes only and is not financial advice.
