Copper is experiencing its strongest performance since the 2009 Great Financial Crisis, with prices surging 42% year-to-date as artificial intelligence infrastructure demands reshape commodity markets. The industrial metal’s 3-month price on the London Metals Exchange reached $12,222 per metric ton on Tuesday, just below Monday’s record high of $12,960 per metric ton.
The metal has posted eight consecutive days of gains, marking its longest winning streak in eight years according to analysis from top economist David Rosenberg. This remarkable rally positions copper as a critical beneficiary of the AI revolution, with the metal serving as a key component in data center construction and regarded as an adjacent investment to the AI trade.
Three primary factors are driving copper’s blistering rally:
- AI Infrastructure Boom: Artificial intelligence data centers require substantial copper for electrical wiring, cooling systems, and power distribution, making the metal essential to AI’s physical infrastructure
- Supply-Demand Imbalance: The industry faces significant supply constraints while demand for electrification continues growing. The US has been aggressively stockpiling copper ahead of tariffs, further tightening available supply
- Tariff Uncertainty: President Donald Trump’s announcement of a 50% tariff on certain copper and copper-intensive goods this summer provided additional upward price momentum
According to Rosenberg, copper’s winning year has been largely fueled by “relentless supply-deficit concerns.” The metal is also benefiting from a broader rally in commodities, with gold up 64% year-to-date. Art Hogan, chief market strategist at B. Riley Wealth Management, notes that precious metals tend to move together: “When the group starts to move, they all move together.”
Wall Street analysts remain bullish on copper’s prospects. JPMorgan’s market intelligence team expects prices to climb to approximately $12,500 per metric ton in the first half of next year, supported by AI demand and potential tariff rollbacks. Goldman Sachs projects even more dramatic gains, forecasting copper will reach $15,000 per metric ton over the next decade—implying 22% upside from current levels. The investment bank stated: “Copper remains our favorite long-run industrial metal because it faces unique supply constraints and structurally strong demand growth.”
Key Quotes
Copper remains our favorite long-run industrial metal because it faces unique supply constraints and structurally strong demand growth
Goldman Sachs analysts made this statement in a client note while projecting copper prices to reach $15,000 per metric ton over the next decade. This reflects Wall Street’s confidence that AI-driven demand will create sustained upward pressure on copper prices.
When the group starts to move, they all move together
Art Hogan, chief market strategist at B. Riley Wealth Management, explained how copper’s rally is partly influenced by the broader precious metals boom, with gold up 64% year-to-date. This highlights how AI infrastructure demand is lifting multiple commodity sectors simultaneously.
relentless supply-deficit concerns
Top economist David Rosenberg used this phrase to describe the primary driver behind copper’s winning year. This characterization emphasizes that the fundamental supply-demand imbalance—exacerbated by AI data center construction—is the core factor supporting higher prices.
Our Take
Copper’s breakout performance serves as a reality check on AI infrastructure costs that often get overlooked in discussions focused on chips and software. The metal’s eight-year winning streak and 42% gains reveal that the physical buildout of AI capabilities requires enormous material resources, creating investment opportunities and potential constraints simultaneously.
What’s particularly noteworthy is Wall Street’s conviction that this isn’t a temporary spike—Goldman’s decade-long forecast suggests analysts believe we’re in the early innings of AI infrastructure deployment. However, the supply constraints highlighted by multiple analysts could become a bottleneck limiting AI expansion if mining production doesn’t accelerate. The tariff dynamics add another layer of complexity, potentially making US data center construction more expensive and possibly shifting some AI infrastructure development to other regions. This copper rally may be an early warning that AI’s physical infrastructure requirements could prove more challenging and costly than the industry anticipates.
Why This Matters
This copper price surge represents a tangible economic indicator of AI’s real-world infrastructure requirements, demonstrating how the technology boom extends far beyond software and semiconductors into traditional industrial commodities. The 42% year-to-date gain signals that AI data center construction is accelerating at unprecedented rates, requiring massive amounts of copper for electrical systems and power distribution.
The supply-demand imbalance highlighted by analysts suggests that AI infrastructure buildout will continue driving commodity prices higher, potentially impacting construction costs across industries and creating inflationary pressures. For investors, copper’s performance validates the “picks and shovels” approach to AI investing—profiting from the infrastructure enabling AI rather than just AI companies themselves.
The bullish long-term forecasts from major banks like Goldman Sachs and JPMorgan indicate that Wall Street views AI-driven demand as structural rather than cyclical, expecting the data center boom to sustain for years. This has significant implications for mining companies, infrastructure developers, and anyone involved in the AI supply chain, while also highlighting potential bottlenecks that could constrain AI expansion if supply challenges aren’t addressed.
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Source: https://www.businessinsider.com/copper-price-today-rally-best-year-2009-forecast-outlook-2025-12