Wall Street is increasingly optimistic about the prospects of copper, despite the metal’s recent price surges. The surge in copper prices can be attributed to a combination of supply risks and growing demand stemming from the energy transition and the surge in artificial intelligence development. Jefferies highlighted the significance of copper in data centers, where it is used in power cables, connectors, and other essential components. The firm projected a significant increase in global copper demand by data centers from 239 kt in 2023 to at least 450 kt per annum by 2030, further driving up prices.
The growing demand for copper in data centers is directly linked to the expanding need for computing power to support artificial intelligence workloads. The development of large language models and other AI infrastructure is fueling the demand for copper, with analysts predicting that the metal could reach $10,500 per ton by the end of the year. This bullish sentiment is also supported by the broader outlook on economic health, as copper plays a crucial role in various industries such as construction, electric vehicles, and more. Investors looking to capitalize on this trend can consider stocks in the Global X Copper Miners ETF, with Canadian firm Solaris Resources standing out for its potential upside and strong buy ratings.
In addition to individual stocks, investors can also explore exchange-traded funds (ETFs) focused on copper mining to gain exposure to the sector. The Sprott Copper Miners ETF and the iShares Copper and Metals Mining ETF are among the options available for those looking to invest in copper. With the increasing demand for copper driven by factors such as the energy transition and AI development, the outlook for the metal remains positive, making it an attractive opportunity for investors seeking exposure to the commodities market.
