Metals have had record years with recent gains in gold (GC=F) and silver (SI=F) prices, but there is a third metal hitting record highs of its own. Copper prices have risen more than 35% this year, poised for their biggest annual gain since 2009, buoyed by rising technological demand, supply constraints, and tariff uncertainty.
Global copper (HG=F) prices officially surpassed $12,000 a tonne on the London Metal Exchange for the first time on Tuesday and continued their march higher on Wednesday.
Each type of metal reacts slightly differently to economic conditions, and copper is no exception. However, unlike gold and silver, copper is not directly affected by investor sentiment or economic expectations. Its price movements can generally be attributed to physical growth and expansion.
Copper is often seen as a barometer of the economy. It plays a central role in power grids, construction, industrial machinery, and more. When there’s demand for those types of goods or services, it’s usually a good sign that the economy has a clean bill of health — giving copper its nickname: Doctor Copper.
Rising copper prices often signal strong industrial demand and a rapidly growing economy, while falling prices can signal an economic slowdown, according to Goldman Sachs Research. “AI and defense are key beneficiaries of investment in grid and power infrastructure globally, driving the need for robust and secure energy networks,” Goldman Sachs research analyst Ioin Dinsmore wrote in a note.
Gold is seen as a “safe-haven” asset and a hedge against inflation. Silver straddles the line between gold and copper and has both investment and industrial purposes. Copper, however, is mainly industrial. It is not usually bought to store like gold or silver but to use, which is why it is usually the strongest indicator, of the three metals, that the economy is going in the right direction.
Read more: Why does silver outperform gold? What you need to know before investing.
There are a few major reasons why copper prices are currently on the rise. Major copper-producing regions such as Chile and Indonesia have faced supply challenges and environmental disasters that have contributed to global copper shortages and tight markets.
“After flat mine supply growth this year, our 2026 mine supply growth estimate has fallen to around +1.4%, or about 500km below our estimate at the start of the year,” Gregory Shearer, head of base and precious metals strategy at JP Morgan, said in a statement.
A glut in supply isn’t the only factor pushing prices higher. In July, the Trump administration issued tariffs on several categories of copper imports, putting further pressure on the market. At the same time, heavy investment in the AI sector is significantly increasing demand for data centers due to their reliance on copper.
One source estimated that hyperscale AI data centers could use up to 50,000 tons of copper per facility.
As far as prices are concerned, JPMorgan Global Research expects copper prices to reach $12,500 a ton in the second quarter of 2026, eventually averaging around $12,075 a ton for the full year.
While researchers are optimistic that copper prices will continue on an upward trend, experts say the long-term impact of the current price increase is uncertain.
“The intersection of tariffs and copper prices in July 2025 highlights the complex dynamics of global trade and commodity markets,” said David Koch, CFP and director of portfolio management at Halbert Hargrove. “While the immediate impact has been a sharp increase in copper prices, the long-term results depend on how markets, governments and industries adapt to this new business environment.”
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