Societe Generale’s Commodity Compass Analytics team, led by Michael Haigh and Jeremy Sellem, reports that copper pricing has undergone significant changes since February 2025, driven by a combination of AI-related demand, arbitrage flows, and US trade policy [1]. The team highlights that limited mine supply and strong competition for copper concentrates have tightened the physical market, making traditional analysis of copper returns increasingly complex [1].
According to Societe Generale, accelerating investment in AI, data centres, power grids, and electric vehicles (EVs) has strengthened expectations for long-term copper consumption, supporting prices in the process [1]. Additionally, tariff-related arbitrage has redirected large volumes of copper inventories towards the United States, further tightening physical availability in other regions [1].
The report emphasizes that these new forces—geographic arbitrage and trade policy—have complicated the market, requiring a revised analytical framework to assess copper’s outlook. Societe Generale aims to decompose copper returns since February 2025 and quantify the contribution of these drivers to price performance, providing a clearer perspective for investors and analysts in a rapidly evolving market environment [1].
CONCLUSION
Copper’s market dynamics have shifted due to AI-driven demand, limited mine supply, and US trade policy, resulting in tighter physical availability and higher prices. Societe Generale suggests that traditional analysis is no longer sufficient, and a new framework is needed to understand copper’s evolving outlook. The market impact is high, with long-term consumption expectations remaining strong.