Copper prices have surged this year, hitting multiple record highs, fueled by supply disruptions and concerns over potential US import tariffs, which led to heightened demand. This rally is expected to continue well into 2026.
Analysts at Citi predict a significant upward spike in copper prices driven by strengthening demand, led primarily by the energy transition and Artificial Intelligence (AI) sectors. Electrification, grid expansion, and the construction of data centers all require substantial amounts of copper for wiring, current transmission, and cooling infrastructure.
The anticipated copper shortage, resulting from constrained mine supply and the continuous "hoarding" of copper in the US due to speculative opportunities, is expected to drive prices higher: "We anticipate the US will be hoarding global copper inventory and, in the case of a bull market, drawing copper from already depleted non-US stocks," the analysts stated.
The price of copper on the London Metal Exchange (LME), the global benchmark, has risen approximately 36% this year and is up 9% over the last month.
According to the global financial services firm's data, the volume of refined copper flowing into the US increased by approximately 650,000 metric tons this year, resulting in an estimated build-up of the country’s copper inventory to about 750,000 metric tons.
Given that US copper prices are currently higher than elsewhere, traders have a strong incentive to import large quantities of the metal into the country.
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