On Thursday (August 6), copper prices surged to a record high, but the mixed global growth environment surrounding this rally has made the once reliable economic bellwether – "Dr. Copper" – less reliable. US copper futures rose to around $6.90 per pound on Thursday. Copper is widely used in construction, electronics, transportation, and even artificial intelligence-related fields, and its price continued its upward trend; after reaching a record high, copper prices retreated, closing slightly lower. Three-month copper on the London Metal Exchange (LME) touched approximately $14,369.5 per tonne, a 1.8% increase during the session, approaching the historical peak of $14,527.5 per tonne set in January of this year. The price spread between COMEX and LME continued to widen, with the cash premium relative to the three-month contract once exceeding $100 per tonne, indicating extremely tight supply in the near term. However, this record copper price does not simply represent a strengthening global economy, but rather a combination of multiple factors: limited supply, large-scale power grid investment, uncertainty brought about by US tariff policies, and increased demand driven by electrification. In the past, copper prices have been seen as a barometer of whether global economic activity is heating up. William Osnato, Director of Commodity Data Research and Analysis at Barchart, told CNBC via email: "The underlying logic for the rise in copper prices is the demand driven by data center and power grid construction supporting the rapid expansion of the AI industry." He added that this round of copper demand surge is "more concentrated, not copper consumption driven by the traditional sense of comprehensive economic growth." This judgment has been confirmed by several institutions. S&P Global predicts that global copper demand will increase from approximately 28 million tons currently to 42 million tons by 2040, a 50% increase. AI and data centers, energy transition (electric vehicles, renewable energy, grid expansion), and defense modernization are emerging as key drivers. A single large AI data center can use 30,000 to 50,000 tons of copper, far exceeding the 5,000 to 15,000 tons used in traditional data centers; an electric vehicle uses approximately 3-4 times more copper than a traditional gasoline-powered vehicle (about 83 kg vs. 23 kg). Some analysts point out that by 2026, the incremental copper demand related to data center construction could reach 300,000 to 700,000 tons, almost equivalent to the entire annual growth in global demand, making it a "new buyer" determining marginal prices. The surge in copper prices also stems from supply-side constraints: high copper mining costs and the approximately 10-year development time to build a new mine limit the release of this red metal's supply. Actual development cycles are often even longer. S&P Global points out that the average copper mine takes 17 years from discovery to production, with a significant amount of time spent on permits, environmental impact assessments, and community negotiations. The global average ore grade has declined by about 40% since 1991. Aging and declining grades in existing mines, coupled with inflation and deeper, more remote mining conditions, have raised the price threshold required to incentivize new supply. The International Energy Agency estimates that existing and planned projects will only meet about 70% of projected demand by 2035, leaving a huge gap. Michael Widmer, head of metals research at Bank of America, stated that this round of price increases is not driven by copper demand, but is essentially a supply issue. Widmer said that weak copper mine production growth and various supply disruptions have further exacerbated the supply shortage. Chile, the world's largest copper producer, has experienced weak mine output growth, with heavy snow, rain, and strong winds disrupting mine operations. Chile's output in the first quarter of 2026 is expected to decline by about 5%-8.8% year-on-year, with a sharp 13% year-on-year drop in May alone, marking several consecutive months of year-on-year declines. Codelco (Chilean state-owned copper company) has publicly admitted that it has failed to meet production expectations for the past seven years, shifting its operational focus from "maximizing production" to "profitability first." Its 2026 production guidance is only 1.331 million to 1.357 million tons, a structural shortfall of over 300,000 tons from previous targets. Operations at its flagship El Teniente mine may be suspended for up to two years. The full restart of the Grasberg mine in Indonesia has been delayed due to a mudslide in 2025, with estimated losses reaching hundreds of thousands of tons. Approximately 64% of global visible copper inventory is stockpiled in the United States, with LME registered warehouse inventory falling to a low of about 227,000 tons. Shanghai Futures Exchange inventory nearly halved to 69,300 tons in July, further exacerbating regional shortages. Potential US Section 232 national security tariffs, coupled with China's tightening of scrap copper supply, will further tighten global copper supply in 2026. Last June, President Trump signed a proclamation imposing a 50% tariff on imports of copper semi-finished products and copper-intensive derivatives. Market expectations that refined copper may be subject to a 15% tariff starting in January 2027 and gradually rising to 30% have triggered a large-scale "import rush": US port copper imports exceeded 200,000 tons in July, the highest monthly record since 2014; COMEX inventories have surged this year, and private port inventories are estimated to have brought total US stockpiles to over 1 million tons. Tightening of scrap copper supply in China, coupled with the expansion of smelting capacity and the disconnect between concentrate supply and demand, has caused processing and refining fees (TC/RC) to fall to historic lows or even become negative. Major Chinese smelters have agreed to cut production by more than 10% by 2026. Copper demand remains strong, closely related to electrification upgrades rather than a general economic boom. In the first half of this year, China's power grid investment increased by 13% year-on-year, and China recently announced a grand plan to invest approximately $574 billion in power grid upgrades. China still accounts for about 58% of global copper consumption, and despite weakness in traditional sectors such as real estate, demand from the power grid, new energy, and AI-related sectors provides a "structural offset." Several institutions have shown significant divergence in their market balance forecasts for 2026: the International Copper Study Group (ICSG) predicts a deficit of approximately 150,000 tons, JPMorgan forecasts 330,000 tons, Morgan Stanley even sees a potential deficit of 600,000 tons, while Goldman Sachs offers a slightly more optimistic scenario of a slight surplus. Goldman Sachs raised its year-end 2026 price target to $13,735 per ton, while Citigroup targets $15,000 per ton within a year. The catalyst for Thursday's surge in copper prices was the Democratic Republic of Congo's formal announcement of a ban on copper and cobalt concentrate exports, aimed at boosting the domestic processing industry. The DRC is the world's second-largest copper producer and largest cobalt producer. The ban, signed on June 29, took immediate effect. While allowing for a one-year export exemption under "strategic circumstances," the overall intention is to force companies to complete higher value-added processing locally. This news quickly fueled market concerns about further supply tightening, compounded by weather and operational disruptions in Chile, creating a short-term "perfect storm." Osnato stated that supply disruptions prompted consumer companies to take large amounts of copper from London Metal Exchange warehouses, driving up refining costs. "This is undoubtedly a completely new situation for 'Dr. Copper'," he said. Traditionally, "Dr. Copper" reflected the activity levels of construction, manufacturing, and broader industrial sectors; now, prices are driven more by highly concentrated structural demand, such as resource nationalism, tariff arbitrage, and AI and power grids. Even with a still mixed global growth environment, copper prices have remained high and reached record levels precisely because the rigid constraints on both the supply and demand sides have far exceeded cyclical fluctuations themselves. In the coming months, the final ruling on the US Section 232 tariffs, the progress of supply recovery in Chile and Congo, and the pace of investment in China's power grid and AI will be key variables determining whether copper prices can further challenge $15,000 per ton. The market has gradually shifted from a "cyclical commodity" pricing logic to a "strategic resource" pricing logic.