On September 4, 1882, Lower Manhattan—today, one of the most popular and wealthiest areas of New York City—abandoned the amber flicker of gas for the white glow of incandescence. There, on Pearl Street, the Edison Illuminating Company, created by Thomas Alva Edison, began generating electricity, powering about 400 light bulbs and serving about 80 customers. The facility became the first central power plant in history, thanks to six jumbo dynamos (the first generators that converted mechanical energy into electrical energy) fueled by coal and converted into the heart of the station. The machinery, however, was nothing without the 24 kilometers of underground wiring, which required an investment that exceeded the cost of the entire system. Copper was used in the core of the filaments of this network—the second metal (after silver) with high conductivity and malleability—which, a century and a half later, has been consolidated as a strategic resource.
Electrical consumption
The dizzying growth in global electricity consumption has strained the supply of this reddish metal, which today struggles to keep up with demand. This relevance led the United States to classify it as a critical mineral in 2025 (the European Union did so in 2023). “Copper is the axis that connects physical machinery, digital intelligence, mobility, infrastructure, communication and security systems. All this has made the future availability of the metal a matter of strategic importance,” say S&P Global experts. Today, its value is through the roof. In early 2026, the price of copper reached a historic milestone above $13,000 per ton in the English market (surpassing the previous record of $11,000 set months earlier), while in the US market, the reference price has jumped around 40% since October to reach an all-time high of more than $14,500 per ton at the end of January, driven by fear of new US tariffs, experts agree. consulted.
But geopolitical instability, after the outbreak of war in Iran, has slowed demand for copper, sinking it in price as investors fear the global economy. ING experts say the copper-to-oil ratio, often seen as an indicator of global growth expectations, has fallen sharply in recent weeks as crude oil prices have risen, highlighting the growing drag on industrial metals from higher energy costs. “A sustained decline would indicate a more complex macroeconomic context, with weaker growth expectations that weigh on demand for the metal,” they highlight in a report. Last week, the ton was quoted below $13,000.
However, in the last year, the story was different. Following an investigation under Section 232 initiated in February 2025 by the US Department of Commerce, In July of that year, Trump announced a 50% tariff on imports of semi-finished products and copper-intensive derivatives (such as cables and tubes), excluding raw ore, cathodes and scrap. This unleashed early buying and volatility. Now, uncertainty focuses on June 2026, when the Commerce Department will deliver a report on refining capacity and a tariff could be justified. Goldman Sachs Research’s base case is that a 25% levy will be implemented on imported refined copper. “There is a great fear that it will not be saved from new taxes,” warns Benchmark Mineral Intelligence.
Added to this is that many investors are placing their money in material goods. Although traditionally this safe haven role corresponded to gold and silver, more and more people are moving their capital towards copper, consolidating it as the new investment alternative. “The price of copper has been driven much more by financial flows than by market fundamentals,” says Carsten Menke, director of Next Generation Research at Julius Baer. For example, speculative trading in the Chinese futures market has picked up massively at a time of weakening demand. This means that while factories and construction companies in the Asian giant (which consumes half of the demand) are buying less copper due to economic weakness, investors and speculators in the futures exchanges have begun to acquire contracts for this mineral to protect their money in the face of the weakness of the US dollar, which has been affected by expectations of interest rate cuts by the Federal Reserve and the uncertainty in Trump’s trade and fiscal policies.
Michael Widmer, head of metals at Bank of America, says that given the uncertainty in the market, American buyers have brought forward copper purchases of around a million tons. The figure represents 3.5% of current global demand, which, according to S&P Global, amounts to 28 million metric tons. Widmer indicates that, instead of flooding the market and lowering prices, that metal has been stored in warehouses under a financial scheme called repo or repo, in which the owners of the metal obtain benefits by keeping it instead of selling it immediately. This has caused less copper to be available for physical delivery on the London Metal Exchange, strengthening global prices by giving the impression that supply is tighter than it really is. At the same time, the US bank expert adds, industrial manufacturers who had stopped buying last year for fear of instability are now returning to the fray all at once to replenish their inventories, generating a wave of pent-up demand that pushes prices even further up and creating a scarcity effect.
What is a reality is that there is no gap between supply and demand at this time. “In fact, the copper market appears to have sufficient supplies for this year,” Menke acknowledges. Starting next year, the rope could be tightened if global growth picks up and new farms are not developed. “The risks of a structural shortage are higher between 2027 and 2035 due to the lack of new copper mines and expansion projects. This could raise prices well above current levels,” highlights the Julius Baer expert. Meeting demand in the future will be a challenge. S&P Global indicates that by 2040, copper needs will be 50% greater than today due to the growing electrification of the economy, the rise of data centers (powered by artificial intelligence) and the defense sector. By then, perhaps, the world will have a deficit close to 10 million tons, in case the supply fails, says the consultancy. To see it, there are still a few years left.
