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Copper and aluminum prices both reached multiyear highs Wednesday, as global demand picks up and supplies tighten.
Benchmark three-month copper futures (HG1:COM) on the London Metal Exchange recently traded +1.2% to $9,582/metric ton, after peaking earlier in the session at $9,616.50, the metal's highest price since June 2022, while aluminum futures (LMAHDS03:COM) were +1.1% to $2,587/ton, after earlier hitting $2,593, its best since February 2023.
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Copper's steady 15% rise in the last three months reflects global growth, demand optimism and material downgrades to 2024 mine supply, and the metal's long-term upside potential continues to strengthen, Saxo Bank head of commodity strategy Ole Hansen said.
The green transition and increased use of AI applications are augmenting demand for the metal from traditional sectors such as construction, Hansen said.
Aluminum also has rallied, as the London Metal Exchange recently banned the delivery of new Russian metal, including copper and aluminum, after new sanctions were imposed by the U.S. and U.K.
The implications for premiums should be bullish, especially for aluminum in Europe, as non-Russian material is sought, Macquarie head of commodities strategy, Marcus Garvey said.