Copper recorded its largest annual gain since 2009, driven by supply constraints and anticipation of increased demand due to electrification, according to Fortune. The red metal's price on the London Metal Exchange (LME) rallied 42% this year, making it the top performer among the exchange's six industrial metals.

Prices experienced a slight dip of 1.1% on Wednesday, the final trading day of 2025. Recent price increases have also been attributed to traders accelerating copper shipments to the United States in anticipation of potential tariffs. This rush has created supply tightness in other regions.

The possibility of renewed tariffs on primary copper in 2026, proposed by Trump, has reignited arbitrage trading, further limiting availability despite softened demand in China, a major consumer. This price difference had recently narrowed following a strong December rally on the LME.

According to Natalie Scott-Gray, senior metals analyst at StoneX Financial Ltd., expectations of future U.S. import tariffs on refined copper have led to over 650,000 tons of metal entering the country, resulting in reduced availability outside the U.S. She also noted that two-thirds of global visible stocks are now held within the U.S.

The surge in copper prices reflects a broader trend of increasing demand for metals essential in renewable energy technologies, electric vehicles, and other applications related to electrification. This demand is projected to continue growing, potentially leading to further price increases if supply constraints persist. The potential implementation of tariffs adds another layer of complexity to the market, influencing trade flows and regional availability.