Copper on Steroids: Red Metal Charges Toward $12,000 on Supply Crunch and Fed Cut Hopes
Mutisunge Zulu
Chief Risk Officer | Global Executive PhD Cand. Business Mgt, AI & Strategy at ESCP Business School | Global Executive MBA (Manchester) | Advanced Management Program (Harvard) |
December 10, 2025
Copper’s surge toward $12,000 per ton is not just another chapter in commodity-market volatility – it is the clearest indication yet that the world’s most important industrial metal has entered a new structural price regime. Long revered as the bellwether for the global economic pulse, copper has now evolved into something even more consequential: a strategic asset underpinning the world’s electrification, AI buildout, grid modernization, and energy transition.
As global markets increasingly price in a U.S. rate-cut cycle, and as supply tightness deepens into a multi-year deficit, copper’s rally has gone into overdrive. This is not speculative exuberance – it is the market recalibrating to long-term scarcity.
A Technical Breakout Fueled by Shifting Monetary Expectations
Copper’s price action reflects both improving macro risk sentiment and accelerating structural constraints.
With traders now assigning higher probability to a Federal Reserve easing cycle, the dollar has softened, real rates have compressed, and industrial metals have responded with synchronized upside momentum. Copper, as usual, leads the pack.
The technicals are unambiguously bullish:
- Ascending-triangle breakout above multi-year resistance
- Bullish moving-average alignment, with the 50-day crossing above the 100-day and converging toward the 200-day
- Momentum indicators (Relative Strength Index – RSI, Moving Average Convergence Divergence – MACD) showing strengthening trend quality without signs of exhaustion
This configuration is emblematic of transitions from late-cycle resilience into early-cycle reflation, historically one of the most powerful phases for copper appreciation.
Copper as a Strategic Asset – And the World’s Growth Bellwether
Few commodities embody such dual significance.
1. Copper as the Global Economic Pulse
Copper is the market’s earliest and most sensitive macro signal. Rising prices historically precede:
- manufacturing expansion,
- improved credit conditions,
- rising industrial output,
- and increased infrastructure spending.
When copper rallies sharply, it indicates momentum building beneath the surface of the global economy.
2. Copper as a Strategic Asset
In the 2020s, copper is no longer just a cyclical indicator, it is the foundational material for the future global economy:
- AI data centers and high-voltage power systems
- EVs that require 4x more copper than ICE vehicles
- Renewable installations (wind, solar, storage)
- Transmission and distribution grid upgrades
- Consumer electronics, robotics, and smart infrastructure
Copper is now in the same strategic category as semiconductors and lithium — not optional, but essential.
This dual identity is why copper’s rally is more powerful, more durable, and more macro-relevant than prior cycles.
The Structural Supply Deficit: A Crisis Years in the Making
The core driver of copper’s rally is not sentiment, it is scarcity.
1. Chronic Underinvestment
Global mining capex remains is approximately 40% below 2012 levels, reflecting years of capital discipline, ESG scrutiny, and a challenging permitting landscape.
2. Declining Ore Grades
Copper grades in major regions have collapsed from 1.5% to below 0.6%, lowering yields and increasing costs.
3. Regional Fragility with a Spotlight on the DRC
The Democratic Republic of the Congo (DRC) is a global supply giant – but one with structural vulnerabilities:
- 2024 output was approximately 3.1 million tones
- Kamoa-Kakula delivered 437,061 tones in 2024 (+12% YoY)
- 2025 YTD (Q3) output at 316,393 tones, pointing to a constrained full-year outlook of 370,000 – 420,000 tones
Infrastructure bottlenecks, persistent power shortages, and jurisdictional risk continue to cap supply potential.
4. Critically Low Inventories
London Metal Exchange Commodity Exchange Incorporated, and Shanghai Futures Exchange stocks remain near multi-decade lows – representing only a few days of global consumption.
The conclusion is unavoidable: There is not enough copper supply today, and there will not be enough supply tomorrow.
Demand: From Cyclical to Structural, From Industry to Electrification
Copper demand is shifting from factory cycles to multi-decade secular expansion.
AI-Powered Power Infrastructure
AI data centers consume 5 -7x more power than traditional ones, driving exponential copper intensity across cables, transformers, and substations.
Electric Vehicles
As EV penetration rises globally, each EV’s copper intensity compounds demand structurally — even during cyclical slowdowns.
Grid Modernization
Transmission and distribution networks globally are overdue for major upgrades. Copper is the irreplaceable conductor of electrified grids.
Renewables
Wind, solar, and storage installations require substantially more copper per megawatt than fossil-based generation.
Demand Will Outstrip Supply
All major forecasts point to widening deficits – reaching 4 – 6 million tones by 2035 without new mega-projects.
Copper demand is not only rising; it is outpacing supply structurally.
Tariffs: A Secondary Accelerator Tightening the Market
Although not the chief catalyst, tariffs have added meaningful tightening pressure.
- Tariffs on copper semis and EV components increase cost bases and prompt stockpiling.
- Deglobalization introduces a risk premium across strategic metals.
- Fabricators securing material early tighten refined copper balances.
Tariffs amplify the rally, but they do not drive it. Fundamentals do
Regional Lens: Zambia and the DRC in a Tightening Market
Zambia continues its upward trajectory. October production climbed 13.15% YoY to 746,679 tones, reinforcing its track toward the 1-million-tonn level.
The production rebound has:
- boosted FX supply,
- increased reserves to $5.2 billion as of September,
- and strengthened the sovereign’s post-restructuring credibility.
With ambitions to reach 3 million tones by 2033/35, Zambia could evolve into a global copper heavyweight, provided the country scales baseload electricity, grid reliability, and mining logistics.
Across the border, the DRC remains both a supply powerhouse and a structural risk point – further tightening the global market as demand accelerates.
What Copper Is Signaling: A New Global Price Regime
Copper on steroids is telling the world three things:
1. The era of cheap copper is over.
Underinvestment and geological decline guarantee tight supply.
2. Demand is structural – not cyclical.
AI, EVs, renewables, and grid buildout will dominate demand for decades.
3. Copper is repricing into a higher long-term equilibrium.
Medium-term trading ranges of $12,000 – $15,000 are increasingly plausible – with upside skew from any supply shock.
Copper is not just rallying; it is rewriting the architecture of global commodities markets.
And as both the bellwether of global growth momentum and a strategic asset of the electrified world, copper’s message is unmistakable:
A new metals super-cycle is forming, and copper is leading it.
