As copper closes in on record highs this week, ETF Shares chief investment officer David Tuckwell has said tight supply and surging demand are reinforcing the metal’s long-term case and supporting BHP’s copper-led pivot.
Copper has surged above US$14,000 a tonne this week, edging close to its January record high of US$14,500 as markets largely brushed aside earlier concerns over the Iran war.
Despite sharp declines in the early weeks of the conflict amid fears of a major hit to the global economy, the future-facing metal has now climbed 13 per cent so far this year.
According to Bloomberg reporting, the recent rally has been driven by a recovery in Chinese demand and tighter Middle Eastern sulfur supply, which is a key input in some copper production processes. It has also become increasingly correlated with US equity markets, with expectations of higher copper use in electrical wiring rising as AI-related stocks surge.
The rally has come even in the face of a fragile Iran war truce and renewed inflation pressure, with US inflation jumping to 3.8 per cent in April — its highest in three years.
Against this backdrop, BHP has been a standout ASX performer this year, with its share price up over 30 per cent year-to-date as at 13 May. Shares in the Big Australian rose as much as 4 per cent to a new peak of $62.30 on the same day.
It has also overtaken Commonwealth Bank to become the largest company listed on the ASX by market capitalisation this week, having briefly held the title before the Iran war started.
While the iron ore major has faced a prevailing bear thesis in recent years centred on forecasts of weakening Chinese demand for Australian iron ore and rising competing supply from Africa, its proactive pivot into copper has so far proven fruitful.
In a note to investors, ETF Shares chief investment officer David Tuckwell said the major’s share price looks set to remain elevated for some time.
“As BHP’s pivot to copper becomes increasingly consequential, the back-and-forth with China on iron ore looks steadily less important,” Tuckwell said.
His comments come after BHP reported a strategic milestone back in February, with copper surpassing iron ore as its largest earnings driver for the first time. In its full-year results, the mining giant reported H126 group EBITDA of US$15.5 billion, with US$8 billion coming from copper. It also lifted its full-year copper production guidance from 1.8 to 2 million tonnes.
At the time, the results sharply contrasted with Rio Tinto’s full-year results, which reported full-year profit after tax for 2025 of US$9.97 billion ($14.1 billion), down 14 per cent in its weakest result in five years.
Its heavier reliance on iron ore weighed on profits, with the company since then signalling a deeper push into the future-facing metal at its recent AGM. It marked the mining giant’s first meeting since its failed merger proposal with Glencore earlier this year, which was also heavily focused on copper as it would have significantly expanded its copper portfolio.
With all eyes squarely back on the metal this week – and ETF Shares itself launching a copper ETF just last month – Tuckwell is backing further gains, with BHP expected to remain a key beneficiary.
“Copper prices have shot back up in recent weeks, driven by a combination of resilient demand out of China and traders front-running US copper tariffs.
“Trump’s 50 per cent tariff on semi-finished copper (effective August 2025) and proposed 30 per cent jump for refined copper by 2028 have created a floor for prices, as traders front-run restricted supply,” he said.
Noting that high copper prices self-evidently help BHP’s share price in the near term as the miner sells into global spot markets, Tuckwell added that what has everyone more excited is the long-term picture.
“The world is running out of economically minable copper at precisely the moment it needs it most. BHP has done more than almost any other major miner to get in front of that, most visibly its Oz Minerals acquisition in 2023 when copper prices were 35 per cent lower.”
On whether copper prices can remain elevated, he said the inability to quickly ramp up supply strengthens the case, citing BHP and Rio Tinto’s Resolution joint venture in Arizona as an example. The mine has only recently been granted fast-track access under US President Trump after spending decades on the shelf.
He added that few major copper deposits have been discovered over the past decade, while mining costs have risen materially and even further since energy markets were disrupted.
“This isn’t to say we’ll run out of copper: we obviously won’t. But it will be like a wet sponge that you have to squeeze progressively harder to get the same amount of water out.”
Ultimately, he said both the metal and the company present a compelling picture for investors going forward.
“All signs point toward copper being a good place to be if you’re a miner. And BHP being a good place to be if you’re a shareholder.”
