Core Insights - Copper prices have reached historic highs, with LME copper recently exceeding $12,000 per metric ton, marking a 42% year-to-date increase driven by strong demand from AI and constrained supply [1][10] - The market is experiencing a structural shift, with analysts predicting a long-term "supercycle" for copper due to factors like electrification and digital infrastructure [2][7] - Investors are encouraged to consider diversified copper ETFs as a strategic investment for 2026, rather than focusing on individual mining companies [2][12] Copper Demand Drivers - The rapid expansion of AI data centers is significantly increasing copper demand, as copper is essential for high-capacity power lines and cooling systems [4][5] - Wood Mackenzie forecasts a 24% increase in global copper demand by 2035, with AI being a major growth catalyst [5][6] - The demand for copper is also driven by energy transition, grid modernization, and transport electrification, alongside national security and infrastructure initiatives [7] Supply Constraints - Meeting the rising demand will require an additional 8 million tons of new mine capacity and 3.5 million tons of scrap copper, creating opportunities for price increases amid supply shortages [8] - Disruptions at major mines and declining ore grades are expected to lead to a projected 330,000-ton deficit for copper by 2026 [8] Price Forecasts - J.P. Morgan projects LME copper to average $12,500 per ton in Q2 2026 and $12,075 for the full year, citing supply disruptions and AI-driven demand as key factors [9] - Goldman Sachs anticipates a near-term price pullback to an average of $10,710 in the first half of 2026, with a long-term forecast of $15,000 per ton by 2035 [10][11] Copper ETFs - Recommended copper ETFs include: - **Global X Copper Miners ETF (COPX)**: $4.56 billion in assets, up 95.3% YTD, NAV of $72.20 [12][13] - **iShares Copper and Metals Mining ETF (ICOP)**: $171 million in assets, up 79.8% YTD, NAV of $44.42 [14] - **Sprott Copper Miners ETF (COPP)**: $97.4 million in assets, up 71.7% YTD, NAV of $34.93 [15] - **United States Copper ETF (CPER)**: $460.7 million in assets, up 40.1% YTD, NAV of $35.44 [16]