Copper Is 21% Higher Than a Year Ago. The Iran Deal Did Not Change the Structural Story.
Copper closed at $6.14 per pound on June 26, 2026, up 21.23% from a year earlier according to Trading Economics data. Over the past month, the price has softened 2.63% as hawkish Federal Reserve expectations, and a stronger US dollar created headwinds for dollar-priced commodities. But the short-term noise around the Iran deal and the Fed's June meeting does not change the fundamental supply-demand picture, which is what long-term investors in copper should actually be watching.
The structural case for copper is built on three demand drivers that are accelerating simultaneously. AI data centres are expected to require 475,000 tonnes of copper in 2026 alone, up from just 110,000 tonnes in 2025, according to JPMorgan. Data centres require extraordinary volumes of copper for cooling systems, power distribution, and connectivity infrastructure, and developers treat copper as an essential input with limited price sensitivity. Beyond AI, electric vehicle adoption and grid expansion for renewable energy both require far more copper per unit of output than the systems they are replacing.
Supply is not keeping pace. Jefferies analysts project a structural annual copper supply deficit of approximately 491,000 tonnes through 2030. The International Copper Study Group confirmed that the copper market entered a deficit in 2026 after two consecutive years of surplus. LME global visible copper inventory reached nearly 1.5 million tonnes earlier in the year, an increase of 540,000 metric tonnes, but this reflects inventory dislocation from tariff-related stockpiling in the US rather than genuine market ease.
Mining output is constrained. Chile, Indonesia, and Peru have all experienced disruptions at major operations. The world's largest copper producer CMOC Group, based in China, planned to increase output by up to 11% in 2026, but geopolitical uncertainty and the Strait closure complicated those plans for operations with Middle East exposure.
The Fed's June hawkish shift is a genuine near-term headwind. As JPMorgan's commodities team noted, if Brent crude remains around $110 per barrel, copper demand growth estimates for 2026 could be reduced by 1.4 percentage points. But if the Iran deal holds and oil falls further, that pressure eases. Goldman Sachs has raised its year-end 2026 copper price forecast to $13,735 per tonne on LME terms, more than 10% above its previous target.
