When most people picture the AI boom, they think of chips and software. We would point you to something less visible: the metals that make it all physically possible. Every data center and every battery keeping one running depend on a handful of commodities, and as the buildout accelerates, so does demand for them.
The case starts with demand that simply is not going away. Copper carries power through every data center, with a single large AI facility requiring up to 50,000 tons. J.P. Morgan expects data center copper demand alone to reach around 475,000 tons in 2026, with the wider market swinging into deficit. Copper recently traded above $13,000 a ton, near record territory. Lithium tells a similar tale. Now almost purely a battery material, the price has nearly doubled in early 2026 to around $26,000 per ton as grid storage demand has grown. Silver, meanwhile, faces a sixth straight year of supply deficit as AI hardware adds to record industrial demand. None of this is a one-way bet. Supply for these metals is often concentrated in a few countries, leaving prices exposed to export controls and regional disruption. New mines can take a decade or more to come online, so supply responds slowly. The flip side is volatility. The near doubling of lithium and silver’s sharp swings this year show that the path is rarely smooth, even when the long-term direction looks supportive.
Taken together, these metals sit at an interesting crossroads of durable demand and constrained supply. We maintain a constructive view on this as a structurally supported theme with durable demand drivers. Our commodities portfolio is part of our broader range of solutions, and if any of this has caught your interest, we would welcome the conversation. Please do get in touch.
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Investments in commodities may have greater volatility than investments in traditional securities, particularly if the instruments involve leverage. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. Use of leveraged commodity-linked derivatives creates an opportunity for increased return but, at the same time, creates the possibility for greater loss.
