- The AI infrastructure boom has helped drive copper prices to records.
- S&P Global predicts a yearslong period of rising demand.
- However, it also expects supply to be constrained through 2040.
Copper joined the mega rally in precious and industrial metals in 2025, but the gains might be far from over if recent forecasts for supply and demand prove correct.
Copper ended 2025 with a gain of about 44%, and touched a fresh all-time high this week. Yet, the AI boom might be the key to another 15 years of surging demand at a time when supply is expected to remain constrained.
S&P Global recently published an analysis of the copper market, predicting that demand is likely to increase by 50% by 2040, reaching 42 million metric tons. The report also said that it will be extremely difficult for the mining industry to keep up as companies struggle with aging mines and regulatory hurdles.
The authors predict that, without new mines or technological advancements, copper production will peak in 2030, leaving the world short of roughly 10 million metric tons by 2040.
"Several countries have deemed copper a 'critical metal' over the past half decade, including, in 2025, the United States. And with good reason," said Carlos Pascual, Senior Vice President, Geopolitics and International Affairs, at S&P Global Energy. "Copper is the connective artery linking physical machinery, digital intelligence, mobility, infrastructure, communication and security systems."
Copper benefited from a broad rush into metals last year that also pushed gold and silver to record highs. Some forecasters have said they think prices for all three metals are likely to decline in the near future as market conditions shift, but copper's industrial importance could continue to buoy it.
José Torres, chief economist at Interactive Brokers, said he thinks copper's global strategic importance means prices will remain elevated.
"Broadly, it has to do with limited supply as nations want to stockpile the cyclical metal to bolster sovereign AI prospects," he told Business Insider. "Governments are afraid that without enough copper, their economies won't remain competitive in a world where advanced technology is increasingly adopted."
Rita Adiani, president and CEO of rare earth mining company Titan Mining Corporation, believes that a surge in demand, as predicted by S&P, would lead to a period of higher prices.
"A significant part of the incremental demand is tied to electrification, grid build, data centers/AI and defense, where copper's conductivity and reliability makes substitution harder in critical applications."
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