Copper is found in the power cable - just as it is in electric cars, heat pumps or smartphones. And this everyday raw material is currently more expensive than ever. On the London Metal Exchange LME the price rose this week to around $14,800 per ton; Since the beginning of the year, the increase has already been around 19 percent.
US tariff concerns are driving up the price of copper
An important reason for the strong price increases is currently in the USA. Traders are transporting large quantities of copper there - out of concern that US President Donald Trump could impose new import tariffs. There is currently no information about whether and when the US administration could introduce copper tariffs, says Thu Lan Nguyen, head of raw materials and foreign exchange analysis at Commerzbank, in an interview with the ARD financial editorial team. "But the market is currently speculating on it."
US copper imports recently reached a record level. In July alone there were more than 220,000 tons. The result: An increasing proportion of the metal ends up in American warehouses. “This deprives the rest of the world of copper,” says Nguyen. Copper inventories in LME warehouses have fallen by almost 40 percent since the end of May.
Chile: Weather extremes endanger copper production
Another risk for the already strained supply is weather extremes. In August, a severe storm with flooding hit several Chilean copper mines, and some even had to stop operations. “Everyone is talking about the El Niño monster,” emphasizes raw materials expert Martin Brückner from Matflixx in an interview with the ARD financial editorial team. The climate phenomenon increases the risk of a lot of rain and strong storms in Chile - and that affects work in the copper mines.
This is particularly relevant because Chile is the largest copper producer in the world. According to the US Geological Survey (USGS), around 5.3 million tons of copper came from Chilean mines in 2025 - almost a quarter of global production.
IEA: “Age of Electricity”
But behind the record there is also a longer-term development: the world needs more and more copper. The International Energy Agency is already talking about the “age of electricity”: from 2026 to 2030, annual growth in global electricity demand is expected to be 50 percent higher on average than in the previous decade.
More and more electricity has to be generated, transported and distributed - and copper is a key raw material for exactly this. "The world is being electrified, and copper is electrifying the world. Copper is the second best conductor of electricity, silver is the best, but silver is also around 150 times more expensive," emphasizes raw materials expert Brückner.
The more electricity is generated, distributed and used, the more copper is needed - for networks, cables, transformers. The International Energy Agency therefore sees the expansion of power grids as one of the most important drivers of copper demand. In its current raw material outlook, it expects an additional copper requirement of around seven million tonnes by 2040.
AI and electric cars are driving copper demand
The boom in demand for copper has recently been massively accelerated by the rapid expansion of the infrastructure for artificial intelligence. The data centers built by US hyperscalers such as Amazon, Alphabet, SpaceX and Meta use enormous amounts of copper, primarily for power distribution.
Added to this is the energy transition: new wind and solar parks must be connected to the grid, as do electricity storage systems. S&P Global expects global copper demand to increase by around 50 percent by 2040. In addition to the energy transition and AI data centers, electromobility is expected to further drive demand.
According to calculations by S&P Global, an electric car contains almost three times as much copper as a classic combustion engine. “There are around 75 kilograms of copper in a single electric car,” emphasizes Matflixx expert Brückner. In an AI data center it could be up to 50,000 tons.
Building and renovating is becoming more expensive
This raises the question for consumers as to how much of the increase in the price of copper on the raw material markets actually reaches them in the end. The metal is also found in many everyday products and applications.
“Construction is becoming more and more expensive,” says raw materials expert Brückner. "In the hardware store you can tell at the checkout whether it's copper water pipes or power cables, but also heat pumps and all electrical installations. All of this gets a real price boost."
The price of copper could also impact network charges
But the effect is not limited to building, renovating and building services. Copper is also part of many devices that consumers use every day. “Copper is also found in electrical engineering, electronics and microchips,” says Commerzbank expert Nguyen. This could then also be reflected in the prices of smartphones and computers, for example.
Grid expansion could also be relevant for consumers: according to the IEA, copper accounts for around 10 to 15 percent of the costs of transformers and power cables. If these costs increase, this can also increase network costs in the long term. According to the Federal Network Agency, network fees already account for around 30 percent of the electricity bill for German households.
Car manufacturers are increasingly relying on aluminum
However, higher copper prices cannot be passed on to customers everywhere. In the car industry, for example, the price war is extremely fierce. BMW, Ferrari, Tesla and several Chinese manufacturers are increasingly using aluminum instead of copper in parts of their vehicle cabling - also because of high copper prices and concerns about future supplies. Aluminum currently only costs about a quarter as much as copper - but it conducts electricity much worse than the red metal.
For consumers, this means that the record price for copper is unlikely to have an immediate impact on prices everywhere. But the more the world becomes electrified and the supply remains scarce, the more expensive copper is likely to become noticeable in everyday life.
