Copper price hits record $12,960 per ton on supply shortage, AI data centers demanding unprecedented quantities

Copper price has surged to a record high of $12,960 per metric ton on the London Metal Exchange, marking the most expensive level ever reached. The rally combines a perfect storm of global supply shortages and explosive demand from the artificial intelligence infrastructure boom reshaping global economies.

What’s Pushing Copper Price to Historic Highs

The copper market has entered uncharted territory as supply constraints collide with surging infrastructure demand. Major mining disruptions across Chile, Peru, and Indonesia have tightened global inventories, while data center buildouts for artificial intelligence applications are consuming record quantities of the red metal. Goldman Sachs earlier revised its 2025 outlook from a projected 105,000-ton surplus to a 55,500-ton deficit after unexpected supply interruptions.

The electrification of everything is propelling copper demand to levels not seen in decades. Renewable energy installations, electric vehicle production, and grid modernization all depend heavily on copper wiring and components. This structural shift in global energy infrastructure has turned copper from a cyclical commodity into a strategic resource.

AI and Data Centers: The New Demand Engine

Artificial intelligence infrastructure has emerged as the primary demand driver reshaping the copper market. U.S. GDP growth in early 2025 was driven almost entirely by rapid AI infrastructure and data center expansion, creating massive requirements for cooling systems, electrical components, and networking equipment that all rely on copper.

Power consumption demands at hyperscale data centers require kilometers of copper cabling and transformers. Companies like Amazon, Google, and Microsoft are engaged in unprecedented infrastructure races, competing to build out AI compute capacity globally. This competition has created a demand dynamic completely different from traditional industrial cycles. India reported 9% copper demand growth in 2025, with most coming from construction and renewable energy projects.

Market Factor	Details
Current Price (LME)	$12,960 per metric ton (December 2025 peak)
2025 YTD Performance	+40.8% annual gain
Projected 2025 Deficit	124,000 metric tons
2026 Supply Outlook	Deficit of 150,000 tons expected
Historical Comparison	Best year since 2009

Supply Disruptions Creating Global Constraints

Mining disruptions have compounded copper’s supply crisis throughout 2025. Chile, the world’s largest copper producer, faced major power outages in February that disrupted operations at critical mining operations. Freeport-McMoRan declared force majeure conditions at its Indonesian operations, one of the globe’s biggest copper mines, further constraining supplies.

The International Copper Study Group made a dramatic reversal in its forecasts. After projecting a 289,000-ton global surplus in April 2025, the organization now expects structural deficits continuing into 2026. BloombergNEF forecasts that copper demand linked to energy transition could triple by 2045, suggesting current supply challenges will only intensify. Declining ore grades at existing mines mean replacement production requires more energy and investment.

What 2026 Could Mean for Copper Markets

Analysts expect copper’s record-breaking run to continue into next year, though volatility will likely increase. Goldman Sachs forecasts LME copper prices averaging around $10,710 in the first half of 2026, suggesting the market may consolidate from current highs. However, Reuters surveys show analyst forecasts clustering between $10,000 and $11,000 per ton for the next two years, well above historical averages.

The tight supply outlook means any additional disruptions could push prices even higher. Tariff concerns and geopolitical uncertainties add another layer of complexity. The market consensus emphasizes that without significant new mine supply coming online within 18 months, supply deficits could persist, limiting downside price potential throughout 2026.

“GDP growth in the first half of 2025 was driven almost entirely by rapid expansion of AI infrastructure and data centers.”

— Capital Research Analysis, Market Commentary

Will Copper Price Records Hold into 2026, or Could Weakness Emerge?

The sustainability of copper’s rally depends on whether supply constraints persist and AI infrastructure spending continues at current momentum. Goldman Sachs has maintained its long-term copper forecast at $15,000 per ton by 2035, suggesting structural market tightness will support prices for years. However, economic slowdowns or reduced AI investment could trigger meaningful corrections. Consolidation at $10,500-$12,000 range appears possible before the next breakout higher emerges in 2026.

Sources

• CNBC – Copper prices analysis and LME records (December 30, 2025)
• Reuters – AI demand and supply deficit projections
• The Guardian – Copper price surge amid shortage concerns