Copper is outshining gold this year. Investors say the rally can survive an AI correction — SkimNews
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- Copper has rallied 15.8% year-to-date and more than 30% over 12 months, outpacing gold futures (down 4.11% YTD, 4.52% over 12 months) and spot gold (down 4% YTD, 4.89% over 12 months).
- Ivanhoe Electric CEO Taylor Melvin told CNBC at LME Week that AI data center and defense copper demand is "almost inelastic" — tech firms won't base hyperscale build-outs on copper cost — even amid a recent "retrench" in tech-stock valuations.
- The Commerce Department recommended a 15% tariff on refined copper starting Jan. 1, 2027, with no final decision announced, driving U.S. stockpiling that has pulled metal off global markets while Chinese inventories sit "exceptionally low" and premiums rise.
- Aberdeen Investments' Iain Pyle called copper the "clearest example" of a market where supply can't keep up with demand, warning that sustained higher prices will be needed and the potential for a price spike has increased.
Why it matters: Copper's outperformance over gold signals a structural shift: AI infrastructure and defense budgets are creating price-inelastic demand, while proposed U.S. tariffs have already reshaped global flows by drawing metal into American warehouses. With Chinese inventories at "exceptionally low" levels and a potential 15% tariff still pending, the supply-side bottleneck means even modest demand shocks could accelerate prices.
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