Copper prices are pushing toward record highs. With supply concerns spreading due to ore shortages and tariff speculation in the US, China—the world’s largest consumer—is stepping up efforts to secure increasingly scarce copper. The picture of the US and China vying for critical minerals essential to the growth of the artificial intelligence (AI) industry has become increasingly clear.
Three-month copper futures on the London Metal Exchange (LME), the global benchmark, stood at $13,791 per metric ton (approximately ¥2.2 million) as of July 31. Prices are trading near the all-time high of $14,527.50 per ton set on January 29. In the most recent session, prices edged down $12 (0.09%) from the previous day, but on a monthly basis for July, they rose 3.11%.
The driving force behind the rally is a tightening supply-demand balance. LME copper inventories continue to trend lower, and the key price spread indicating near-term supply shortages (the cash-to-three-month backwardation) has widened. Market participants increasingly believe that “the rapid drawdown in inventories is flashing signs of a supply squeeze.”
At the heart of the matter is the behavior of China, the largest consumer. Chinese copper smelters are facing difficulties procuring raw materials, including copper concentrate and copper scrap. With domestic mine development failing to keep pace with demand and reliance on imports rising, the global stagnation in ore supply is beginning to pressure Chinese smelter operations.
Adding to supply concerns is the possibility that the US could impose tariffs on copper. The Trump administration has championed expanding domestic production of critical minerals and has moved toward designating copper as a material critical to national security. If tariffs are imposed, flows of copper destined for the US could be disrupted, and expectations are growing that the global supply-demand balance would tighten further.
Against this backdrop, competition between the US and China to secure copper is intensifying. With the expansion of the AI industry, copper demand is expected to keep growing for data centers, power grid upgrades, and related infrastructure. Combined with demand from electric vehicles (EVs) and renewable energy projects, copper is increasingly being called “the new oil.”
Looking at price movements across major base metals, other metals are showing mixed performance in recent trading.
| Commodity | LME Price as of July 31 | Day Change |
| Copper | $13,791 (approx. ¥2.2 million) | -0.09% |
| Aluminum | $3,184 (approx. ¥500,000) | -0.4% |
| Nickel | $17,249 (approx. ¥2.7 million) | -0.1% |
| Zinc | $3,643 (approx. ¥570,000) | +0.6% |
| Tin | $55,268 (approx. ¥8.6 million) | +0.5% |
| Lead | $1,877.50 (approx. ¥290,000) | -1.0% |
Note: Prices are per metric ton. Currency conversion calculated at approximately ¥160 per dollar.
Persistently high copper prices could impact a broad range of industries through global inflationary pressures and rising corporate costs. In particular, manufacturers that use copper heavily—such as wire and cable producers, motor makers, and electronics component manufacturers—face margin compression. On the other hand, major mining companies that produce copper stand to benefit.
Looking ahead, many market participants expect that “as long as the supply squeeze persists, prices will remain elevated,” according to one commodities analyst. However, risks of significant price swings remain depending on the details of US tariff policy and the trajectory of Chinese demand. Investors are closely watching policy developments in both countries and the direction of inventory levels.
