Copper’s Retreat Could Position it for a Major Rally

Following its recent rally in July which saw the metal’s prices rise to new highs, copper has recorded a significant drop these last few months. Despite this, analysts argue that the upward trend is nowhere near finished. Forecasts point to demand for the red metal soon surpassing available supply, potentially paving the way for another price surge.

RJO Futures’ Senior Market Strategist, John Caruso, explains that with the metal’s consumption expected to rise by roughly a million metric tons annually over the next ten years, copper is ripe for a lasting rally.

Even though the Trump administration has stepped back from clean-energy initiatives, cutting billions in funding for sectors that rely heavily on copper, international climate-action efforts continue to drive interest. A spike in electricity needs from AI-powered data centers is also fueling expectations for sustained copper usage.

Mount Lucas Management’s co-head of investing, David Aspell, explains that the long-term demand picture for copper remains robust as it’s supported by expanding AI infrastructure and growing requirements from data-center developers. Figures from a report by the U.S. Department of Energy show that in 2023, data centers consumed roughly 4.4% of all electricity used in the country. By 2028, this figure is projected to increase to between 6.7% and 12%.

A review of figures from FactSet indicates that benchmark U.S. copper prices were up 44.5% at this year’s peak, as compared to prices at the end of last year. Copper reached an all-time high of $5.959 per pound on July 24^th, with CQG data showing that on the London Metal Exchange, three-month copper futures hit a record $11,200 per metric ton on October 29^th.

Expectations that the Trump administration might introduce tariffs on imported refined copper sent Comex prices in New York rising above those in London.

Aspell noted that once tariff proposals surfaced, the steady gap between both cities’ prices began to widen, noting that Comex markets moved higher on the possibility of new restrictions. This prompted more importers to ship in copper before any tariffs were enacted, driving them to accept elevated prices. However, New York futures retreated after the administration clarified that the tariffs would target processed copper rather than refined copper.

In comparison to their peak 4 months ago, copper prices on the Comex have dropped by almost 15%. BCA Research’s senior energy and commodities strategist Roqaya Ibrahim expects the lingering possibility of tariffs being imposed on refined copper to keep influencing how the market moves.

If the expected surge in copper prices materializes, entities like Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) could see a rise in investor interest as the need for exposure to copper gains additional momentum.

NOTE TO INVESTORS: The latest news and updates relating to Aston Bay Holdings Ltd. (TSX.V: BAY) (OTCQB: ATBHF) are available in the company’s newsroom at https://ibn.fm/ATBHF

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