Copper prices in the U.S. have climbed nearly 25% this year, hovering just below $5 a pound. That’s an impressive gain, but the red metal still trails far behind the performance of precious metals such as gold and silver — gold, for instance, is up about 60%. The gap may not last long. A powerful new driver is emerging to push copper higher: the rapid expansion of artificial intelligence infrastructure.
Data Centers Powering Demand
The AI revolution is sparking a construction boom in data centers — massive facilities packed with high-performance servers that require extensive copper wiring to deliver power and handle data flow. This surge in copper demand could give prices a sustained lift unlike anything seen in years.
Still, volatility has defined copper’s trajectory in 2025. Prices remain well below July’s near-record $6 per pound, which collapsed after former President Donald Trump threatened additional tariffs on China, the world’s largest copper consumer. Since then, copper has rebounded from a summer low of around $4.35, aided by supply concerns after a major mudslide disrupted operations at Freeport-McMoRan’s Grasberg mine in Indonesia — one of the largest copper mines on the planet.
Long-Term Tailwinds Outweigh Short-Term Noise
Beyond trade tensions and temporary disruptions, the structural demand story remains compelling. The global race to build AI data centers — and the massive electrical grids to power them — is creating a new, durable source of copper consumption.
Analysts at Wood Mackenzie, an energy and natural resources research firm, noted in a recent report that copper accounts for less than 0.5% of total data center construction costs. That means developers are largely indifferent to price increases — a setup that could magnify the impact of demand spikes in an already tight market.
“Should data center construction double in a given year,” the report warned, “copper prices could surge by 15% or more, quickly drawing down inventories.”
Stocks to Watch
For investors, this backdrop could mean opportunity — particularly in the mining sector.
Freeport-McMoRan (FCX), one of the world’s largest copper producers, stands to benefit from rising prices. Despite that, its shares have underperformed, rising only 9% year-to-date. By comparison, Southern Copper has soared nearly 50% in 2025, while major copper mining ETFs — including the Sprott Copper Miners ETF, iShares Copper and Metals Mining ETF, and Global X Copper Miners ETF — are up between 50% and 65%.
According to Daniel Major, an analyst at UBS, copper could climb back to $6 per pound by 2027, with Freeport-McMoRan among the biggest beneficiaries. He also named Anglo American and Teck Resources — two major miners that announced a merger plan in early September — as strong plays on the long-term copper story.
Electrification and AI: A Durable Duo
Major expects copper demand to remain robust through 2026 and 2027, driven by “accelerated investment in power grids.” Simply put, as AI adoption fuels electrification — from server farms to renewable infrastructure — copper will remain indispensable.
For investors betting on the materials that power the next wave of technology, copper and its miners may represent a strategic, long-term opportunity hiding in plain sight.
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