The Zhitong Finance App learned that Minmetals Securities released a research report saying that in 2026, copper prices will continue to rise and set historical records, and that continued supply-side tightening is the core factor driving this round of copper price increases. On the policy side, US tariffs are expected to create room for arbitrage, and the siphon effect boosts copper prices. In the medium to long term, the AI field does have the potential to grow into an increase in structural demand for copper, but in the short term, the actual usage of copper in the AI field is relatively small, less than 3%.
Minmetals Securities's main views are as follows:
Currently, copper prices are operating in a historically high range
Copper prices continued to rise and set historical records in 2026. Three-month copper on the London Metal Exchange (LME) hit an all-time high of $14,527/ton during the session on January 29. Looking at the end of the year, copper prices have strengthened again recently. In the international market, LME copper futures broke through the 14,000 US dollar mark in August 6. The three-month copper settlement price on August 6 was 14,260 US dollars/ton, an increase of nearly 14% during the year, approaching the historical peak set in January. In the domestic market, the main contract for SHFE copper hit an intraday high of 108,450 yuan/ton on August 12, close to the annual high in May.
Continued supply-side tightening is the core factor driving the current round of copper price increases
In terms of stocks, disrupted production capacity and declining grades have caused the current production of major copper companies to fall short of expectations, providing support for high copper prices. The International Copper Research Organization (ICSG) has lowered its forecast for global copper production growth in 2026 from 2.3% to 1.6%, corresponding to an output of about 23.56 million tons. On the incremental side, due to geopolitics, regulatory approvals, etc., the resumption of production and the commissioning of new mines have also been delayed. It is worth noting that the impact of external disturbances such as extreme weather, geological risks, and policy bans on supply continues to rise. As a barometer of supply and demand, copper concentrate processing fees fell to -174 US dollars/thousand tons in August, the lowest level since 2021.
On the policy side, US tariffs are expected to create room for arbitrage, and the siphon effect boosts copper prices
After the US launched the “232 investigation” on copper products in February 2025, the market began to anticipate additional tariffs on refined copper. This expectation directly boosted COMEX copper prices, making them consistently higher than LME copper prices. Subsequently, the spread drove global copper resources into the US. Driven by solid arbitrage profits, global traders are concentrating on shipping refined copper to the US. By the beginning of August, COMEX copper stocks had climbed to over 650,000 tons, surging about 665% from 80,000 to 90,000 tons when the survey began in February 2025, setting a record high in the exchange's 100-year history.
On the demand side, the impact of AI on copper prices is more reflected in value revaluation and expected premiums brought about by the strategic positioning of “new oil in the AI era”. Its impact on actual consumption is still in its early stages
Copper's physical properties, cost economy, and existing technology ecosystem together determine its structural advantages in AI applications. In the medium to long term, the AI sector does have the potential to grow into an increase in structural demand. The compound growth rate of new copper usage in global computing power is expected to be 21% from 2025 to 2030. However, in the short term, the actual usage of copper in the AI field is relatively small, less than 3%. The actual consumption scale is not enough to have an important impact on the balance between supply and demand in the copper market. The current impact weight is far lower than the impact on the supply side and policy side.
industrial metals
Improved macroeconomic sentiment boosted the sector. Metal prices fluctuated strongly in July, focusing on copper, tin, and nickel. Copper: Mining shortages continued to deepen, TC repeatedly hit record lows, domestic inventories fell to a low level, and copper prices fluctuated strongly; tin: Myanmar, Indonesia, and the Democratic Republic of the Congo (DRC) triple supply disruptions continued, and low inventories supported high price operations, but off-season demand limited growth; nickel: internal and external inventory trends of refined nickel diverged, and Indonesian policy tightening and cost increases provided bottom support, but weak downstream consumption suppressed the upper space, and nickel prices fluctuated widely.
Other metals
Supply rigidity dominates, and the strategic small metal price center is expected to move upward, focusing on tungsten and molybdenum. Tungsten: The mining side's willingness to raise prices is stable, but downstream consumption is slow to make up stocks during the off-season. Prices in the industrial chain fall first, and stagnate at the end of the month. Demand in the hard alloy and high-end manufacturing sector and high overseas premiums serve as the center for subsequent price increases; molybdenum: mining companies' production capacity is close to the upper limit and import supplementation is weak, which resonates with the steady acceptance of demand in the special steel and new energy sectors. The tight balance pattern of supply and demand supports prices to continue to operate strongly.
Risk warning: 1. Risk of changes in US copper tariff policy; 2. Risk of mining side supply exceeding expectations; 3. Risk of fluctuations in the intensity of geographical conflicts; 4. AI data center construction falls short of expectations.