While Gold and Silver have dominated headlines with historic rallies in 2025, Copper could be setting up for an impressive move in 2026.
Copper surged over 30% YTD on Comex to reach a 5-month high of $5.90, while Copper jumped above $12,000 on LME, a record high, up 42% this year. Supply constraints, structural shifts in demand, and investment inflows drove gains, as did a weaker USD and Federal Reserve rate cuts. These factors look set to continue in 2026, potentially lifting Copper prices to new highs.
Copper AI and EV demand vs supply constraints
For years, Copper, also known as Dr Copper, has been considered a barometer of global growth. However, the metal is also becoming an essential part of the AI and EV trade. The metal is necessary for wiring, data centres, next-generation power transmission, renewable energy, and power grids, which are driving long-term consumption.
Demand for Copper used in AI infrastructure is accelerating rapidly, as data centres can require up to 10 times the electrical load of traditional facilities. AI cooling systems also require specialized Copper components, and the computing buildout requires unprecedented Copper tonnage, which is already failing to keep pace.
Copper is also a key component in the EV transition. Over the next 20 years, demand for copper in the energy transition is expected to triple.
The ramp-up in demand comes as additional supply is slow to materialize. Supply constraints are already visible with disruptions in Chile, Indonesia, and Peru, tightening the market. BloombergNEF estimates the copper shortfall could reach 19 million tonnes over the coming 25 years without new mines or significant gains in scrap collection/ recycling.
Tariff & inventory worries
Over the summer of 2025, the US administration surprised the market by initially exempting refined Copper from the 50% tariffs, which were then applied only to semi-finished copper products and copper derivatives. As a result, the copper price dropped sharply. However, there are growing concerns that tariffs could be extended, potentially triggering another drawdown of LME inventory for Comex stockpiling. While the U.S. Secretary of Commerce initially proposed tariffs on refined Copper to be introduced gradually, starting in 2027, there is a possibility that the Trump administration could expedite their implementation.
Copper-to-gold ratio is at multi-decade lows
Gold has climbed 60% over the past twelve months, boosted by easing monetary policy, central bank buying, and fiscal concerns. The copper-to-gold ratio has declined to levels not seen in 50 years, a move that is unlikely to be sustainable.
Copper technical analysis
On the weekly chart, Copper has been forming a series of higher highs and higher lows since July 2022. The price is recovering from the summer drop, rising from 4.38 USD/lb (43,800) to 5.91 USD/lb (59,100)—the price trades above its upward-sloping 50 and 200 SMA. The RSI supports further upside while it remains below the overbought threshold. Buyers will look to extend gains above 5.99 (59,900), the 2025 high, to push towards 6.5 (65,000).
Support can be seen at 5.00, (50,000), the psychological level, and below here, 4.40, (44,000), the August low comes into play. A break below here creates a lower low.
