Copper Sets Back-to-Back Record Close Fueled by AI Data Center Demand

CNBC reported Tuesday that copper has struck a copper record high for the second consecutive session, with artificial intelligence infrastructure spending identified as a primary force behind the surge. Citigroup is now telling clients to lean into the rally rather than wait for a pullback.

Copper Logs Consecutive Record Closes

July-dated copper futures settled up roughly 1.1% on Tuesday to 6.531. The contract then pushed even higher in after-hours trading. On the London Metal Exchange, copper added more than half a percent to close at $14,021 per metric ton, also marking a fresh all-time high. Year to date, the metal has climbed nearly 15%, with roughly 8% of those gains accumulating since the outbreak of the Iran war earlier this year.

AI and Energy Transition Are Rewriting Copper Demand

Citi strategist Charlie Massy-Collier argued in a Monday client note that virtually all of the net growth in copper consumption since 2022 traces back to two themes. The first is the global energy transition. The second is the rapid buildout of AI data centers, which require vast copper wiring for power distribution and cooling infrastructure. Massy-Collier also flagged a newer demand driver gaining momentum. Governments and strategic buyers have begun stockpiling the metal, a dynamic the bank believes could amplify price moves beyond what underlying consumption alone would justify.

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Why $13,500 Was the Pivotal Level

Citi had been cautious about recommending fresh copper longs while the metal struggled to clear resistance near $13,500 per metric ton. Massy-Collier attributed that ceiling partly to heavy inventory builds across global warehouses during the first quarter. Those stockpiles signaled that physical buyers were reluctant to pay up at those prices. The clean break above that threshold has now changed the bank’s view. The strategist read the move as the market validating both the structural and near-term demand case simultaneously.

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Citi’s Bull Case and How It Is Playing the Trade

The bank’s upside target sits at $15,000 per metric ton, implying roughly 7% further appreciation from Tuesday’s LME close. Massy-Collier is expressing the view through an LME copper digital call option struck at $15,250, set to expire on August 5. The trade structure limits downside exposure while capturing a defined payout if copper continues to climb through the summer.

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