Copper Prices Surge on Structural Squeeze, Analyst Warns
Copper prices have surged roughly 50% over the past year, and analysts are warning that this rally is no ordinary commodities cycle. According to Sprott Asset Management's Jacob White, the increase in demand from power grids, AI, and defense sectors, combined with mine supply constraints, suggests a deeper structural squeeze.
The metal has set records this month, reaching around $14,545 per tonne, despite mixed economic indicators. White believes that copper consumption is increasingly driven by electricity networks, AI data centers, defense systems, and energy infrastructure backed by government policy and national security priorities.
Competition for copper concentrate has intensified in July, with spot treatment charges falling to a record low and Chilean miner Antofagasta shifting its mid-year sales away from fixed terms. This scarcity is shifting the balance of power decisively towards copper miners, White said.