Copper anodes come out of a furnace at the Glencore Canadian Copper Refinery (CCR) in Montreal, Quebec, Canada on Tuesday, August 12, 2025.
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Copper is on track for its biggest annual price rise in more than a decade, driven by supply disruptions, a weakening U.S. dollar, rising expectations for Chinese economic growth – and blockbuster spending on artificial intelligence.
Analysts expect the red metal’s rally could continue next year, especially amid supply fears and a rapidly expanding global data center footprint.
Three-month copper prices on the London Metal Exchange (LME) rose 1.5% to $12,405 a tonne on Tuesday, erasing recent gains after hitting a record high of $12,960 in the previous session.
The benchmark contract, which has gained about 41% this year, is on track for its best year since 2009, when it gained more than 140% as it emerged from the global financial crisis.
In New York, copper prices have risen more than 40% since the start of 2025, on track for their biggest annual gain since 2009, when the contract rose 137.3%.
Demand for copper is widely seen as an indicator of economic health. The base metal is crucial to the energy transition ecosystem and is an essential part of the production of electric vehicles, power grids and wind turbines.
In fact, electrification, grid expansion and data center expansion require large amounts of copper for cabling, power transmission and cooling infrastructure.
Ian Roper, commodities strategist at Astris Advisory Japan KK, cited a global boom in AI demand as the latest driver for copper prices, with “very tight” markets likely meaning the red metal could rise even further next year.
“The story for copper in recent years has been green energy, right? Even though China has seen a huge real estate downturn.” [and] “That impacts things like steel demand and iron ore prices, but it doesn’t have as much of an impact on copper,” Roper told CNBC’s Dan Murphy on Dec. 23.
“Copper has been a big beneficiary of the expansion of renewable energy and electric vehicles, and now of course data centers are the big growth story,” he added.
AI and defense
Analysts at JPMorgan said in a research note published in late November that LME copper prices could rise even further next year, forecasting an average of $12,500 a tonne for the second quarter.
The Wall Street bank said it expects copper to cost an average of $12,075 by 2026, calling growth in data center demand an “extremely current” upside risk.
“All in all, we believe these unique dynamics of disjointed inventories and acute supply disruptions exacerbating the copper market are driving bullish sentiment for copper and will be enough to drive prices above $12,000 per ton in the first half of 2026,” Gregory Shearer, head of base and precious metals strategy at JPMorgan, said in the note.
Coils, wound copper wires, lie on pallets in the wire mill (coiler) of Aurubis AG. After a casting and rolling process, hot copper wire is wound through the reel into a coil that weighs up to five tons and is around twelve kilometers long.
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However, not everyone is so optimistic about the copper price outlook.
Analysts at Goldman Sachs Research expect copper prices to retreat from recent record highs, even as growing demand for the metal gradually pushes prices higher in the longer term.
In a research note published on December 11, Goldman Sachs Research analysts said LME copper prices are expected to remain in a range of $10,000 to $11,000 as robust global demand growth from the grid and energy infrastructure sector, “supported by investments in strategic sectors such as AI and defense,” prevents prices from falling below $10,000.
Analysts expect LME copper prices to average $10,710 in the first half of 2026. Looking further ahead, they forecast LME copper prices to rise to $15,000 in 2035, noting that this is above industry analyst consensus.
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