Copper is on track for its strongest annual performance since 2009, fueled by a confluence of supply constraints, a weakening U.S. dollar, rising optimism around China’s economic recovery, and surging demand linked to artificial intelligence. Prices for the three-month copper contract on the London Metal Exchange (LME) rose 1.5% to $12,405 per metric ton on Tuesday, following a record high of $12,960 in the previous session. The benchmark contract is up nearly 41% year-to-date, marking its best performance since the post-crisis boom of 2009, when it surged over 140%. In New York, copper has climbed more than 40% since the start of 2025, also putting it on course for its largest annual gain since 2009. Copper is widely seen as a barometer of global economic health. The metal is essential for the energy transition, playing a key role in electric vehicles, renewable energy infrastructure, power grids, and wind turbines. However, the latest surge in demand is being driven not just by green energy, but also by the rapid expansion of data centers supporting AI development and growing investments in defense infrastructure. Ian Roper, commodity strategist at Astris Advisory Japan KK, highlighted the growing influence of AI on copper markets. “The story for copper over the past few years has been green energy. Even with China’s property sector downturn affecting steel and iron ore, copper has remained resilient,” Roper told CNBC’s Dan Murphy on December 23. “Now, data centers are the new growth story—this is a major driver of demand.” JPMorgan analysts echoed this view in a late November research note, forecasting that LME copper prices could continue rising in 2026. They expect an average price of $12,500 per metric ton in the second quarter and a full-year average of $12,075. The bank cited data center expansion and persistent supply disruptions as key bullish factors, suggesting prices could exceed $12,000 per metric ton in the first half of 2026. However, not all analysts are as optimistic. Goldman Sachs Research projects a more cautious outlook, expecting LME copper prices to stabilize between $10,000 and $11,000 in the near term. While acknowledging strong demand from grid infrastructure, AI, and defense sectors, the firm believes this will prevent prices from falling below $10,000. They forecast an average of $10,710 for the first half of 2026. Looking further ahead, Goldman Sachs anticipates copper prices could reach $15,000 per metric ton by 2035—well above the current consensus among industry analysts—driven by long-term structural demand from electrification and digital infrastructure.