ISTANBUL, August 5, 2026 — Continued demand from the artificial intelligence sector, concerns over global supply and rising uncertainty in international trade pushed base metal prices higher in July.
Expectations that the U.S. Federal Reserve would not raise interest rates in the near term, a weaker dollar index and supply concerns also supported gains across the base metals market.
On over-the-counter markets, copper prices rose 4.7% in July, while aluminum increased 2.5%, lead 0.2%, nickel 5.2% and zinc 2.5%.
Copper supply concerns intensify
Concerns that existing and planned mining projects may fail to keep pace with rapidly rising consumption have intensified pressure on copper supplies.
Optimism over demand was also supported by deeper cooperation between South Korea and Chile in critical mineral supply chains. The two countries signed five memorandums of understanding focused on lithium and copper, covering supply-chain cooperation, information sharing and technology collaboration.
Chile is the world’s largest copper producer, while South Korea is a major player in the semiconductor and battery industries.
Declining global copper inventories, concerns over mining supply in Chile and lower processing fees have pointed to tighter supply conditions. Strong demand from China has further tightened the global copper market.
Production disruptions at smelters due to weather conditions and operational problems have added to supply pressures. Expectations that the United States could impose tariffs on copper imports have also contributed to concerns over availability.
Aluminum, nickel and zinc face supply risks
Aluminum markets have also been affected by supply concerns. Falling inventories on the London Metal Exchange (LME) and the Shanghai Metal Exchange have added to worries about availability.
The ongoing conflict in the Middle East has reportedly made aluminum can supplies more difficult, affecting the operations of companies such as Coca-Cola.
New controls imposed by Indonesia on rare earth elements, uranium and tin have also disrupted aluminum shipments, further increasing supply concerns.
In nickel, reports that the United States could impose a 12.5% tariff on imports from 60 countries increased concerns over trade costs, while Indonesia’s quota restrictions added to supply-side risks.
Zinc prices also climbed as low inventories and supply risks came to the forefront.
AI emerges as a key source of metal demand
Zafer Ergezen, a futures and commodities market specialist, said defense and artificial intelligence have emerged as particularly important sources of demand for base metals.
He noted that AI is currently one of the sectors contributing most to global economic growth and attracting the largest investments. The resulting expansion in AI infrastructure is significantly increasing demand for base metals.
Even though AI companies’ stocks have recently come under selling pressure, Ergezen said this has not changed the underlying picture of strong real-world demand and growth in the sector.
He expects AI-driven growth to continue and said this could keep the prices of certain base metals on an upward trajectory, making them relatively more resilient against potential declines.
The combination of AI-driven demand, constrained supply, falling inventories and geopolitical uncertainty is therefore expected to remain an important factor for base metal markets in the coming period.
Source: Patronlar Dünyası/ Prepared by: İlayda Gök