Copper resumed its advance along with other industrial metals as tensions eased in the Middle East, boosting risk appetite. The red metal rose 0.6% to 13,695 a ton on the London Metal Exchange as of 9:10 a.m. local time, reversing losses of as much as 0.5% during Asian hours. Tin also gained 0.7% to $52,650 a ton, with other base metals also higher. The recovery came after Iran and Israel agreed to halt strikes against each other, easing concerns that had threatened to derail negotiations to end the wider regional conflict. The flare-up had stoked inflation and raised the prospect of higher interest rates that could slow global growth and metals demand.
Copper price reached a record high of $6.63 per pound on June 2, driven by the same AI data center buildout powering Nvidia and the broader AI complex. However, the price has since retreated to around $6.27, down roughly 6% from that peak, as reported by BeInCrypto. The metal's recent performance reflects a complex market dynamic where options traders are leaning bullish with a put-call ratio below 1, indicating calls outnumber puts, while commercial hedgers remain heavily net short and trimmed longs by 3,254 contracts according to the latest CFTC Commitments of Traders report. The divergence between speculative optimism and professional caution highlights the mixed sentiment surrounding copper's near-term prospects. Copper was down 0.4% at 13,565 on the London Metal Exchange as of 12:125 p.m. in Shanghai, with other base metals also declining as tin slipped 1.1% to $51,720 a ton.
The AI boom has made copper indispensable for data center infrastructure, with a single hyperscale AI facility using up to 50,000 tons of copper against 5,000 to 15,000 tons for a conventional data center, according to the Copper Development Association. JPMorgan estimates data centers alone will need about 475,000 tons of copper this year, up sharply from the prior year. Nvidia CEO Jensen Huang has emphasized that copper will dominate chip interconnects for as long as possible before any shift to optics, with this demand sitting on top of a structural shortage where S&P Global projects a 10 million tonne deficit by 2040. The scale of AI infrastructure requirements directly ties copper demand to the same trade lifting Nvidia and the broader AI complex, creating a fundamental supply-demand imbalance. Shares of AI companies have been linked to metals trading in recent months, led by copper and tin due to their use in electrical wires and other equipment, though a three-day selloff in tech stocks highlighted risks to the base metals complex.
Copper declined as expectations for a US rate hike and risks around artificial intelligence stocks reduced appetite for industrial metals, according to Bloomberg reports. The Iran war, now in its fourth month, has driven up inflation and raised the prospect of higher interest rates that could slow global growth and metals demand. Some bulls are exiting base metals due to uncertainty around rate hikes, said Zhenting Zhou, a trader with Hangzhou Chenglian Industrial Co. Risks around AI stocks are also deterring investors, he added. The decline came despite a surge in Chinese exports last month, up more than 19% from a year earlier, topping forecasts as booming demand for AI hardware offset disruptions from the war in Iran. Aggregate open interest for copper on the Shanghai Futures Exchange fell to the lowest since September, according to bourse data, indicating reduced speculative interest in the metal.
Indian copper-related companies have experienced remarkable stock price appreciation as investors position themselves for AI infrastructure growth. Hindustan Copper shares have surged approximately 120% over the past year, while copper recycler Pondy Oxides has gained nearly 80% during the same period. Jain Resource Recycling has moved 36% higher in the last one year, according to reports from The Economic Times. However, Gravita India, another recycler, has seen a fall of 12% in the same period due to margin pressure and slow growth in profit. The recent copper price volatility, with the metal forming a double top pattern near its record zone in May and early June, has created uncertainty despite the strong underlying demand story.
The investment story received significant momentum after the government unveiled its Copper Vision Document in 2025, projecting a six-fold increase in copper demand by 2047. This projection is driven by electric vehicles, artificial intelligence, renewable energy and power infrastructure development. The roadmap envisages adding 5 million tonnes per annum (mtpa) smelting and refining capacity by 2030 while expanding recycling and overseas resource partnerships. As reported by The Economic Times, domestic demand for copper is projected to rise significantly, with a need for 3–3.3 million metric tonne by 2030 and up to 9.8 million metric tonne by 2047. The Ministry of Mines projects a five-fold rise in domestic demand to approximately 10 million tonnes by 2047, with India currently consuming just 1 kg of copper per person annually against a world average of 3.2 kg. For the long term, sustained strong demand for the industrial metal means prices will rise to and average of $8 a pound ($17,636 a ton) in 2030 and 2031, according to Jefferies analysts, who adopted a previous bullish scenario as their new base case.
India faces significant supply constraints in copper production, with domestic mines meeting only about 5% of the country's copper requirement, leaving the market heavily dependent on imports. According to Manish Sonthalia, CIO at Emkay Investment Managers, 'Scarcity is one reason why the market has begun rerating copper-related companies'. Copper spot prices on the London Metal Exchange have surged 41% over the past year, reflecting growing demand from data centres, power networks and electrification projects linked to the AI boom. The recent tensions around the Strait of Hormuz serve as another reminder that supply chains have become the new fault lines of geopolitics, highlighting India's vulnerability in critical resource dependencies.
