It's been an eventful year in markets, and2025 will be remembered, in part, for gold (GC=F) and silver (SI=F) reaching new highs, marking one of their best years on record.
But these aren't the only metals that sawmajor gains in 2025.
The price of industrial metals copper(HG=F), aluminum (ALI=F), and steel (HRC=F) have all soared this year, as has the battery metal lithium. And in contrast to gold and silver, which are being bought as safe-haven trades amid global uncertainty, much of the movement in these metals is driven by the AI build-out and energy transition.
"The world is moving from afossil-fueled economy to one powered by technologies consisting of
metals," Jim Wiederhold, commodity index product manager at Bloomberg, wrote in a client note.
"The future is metal," he wrote.
Wiring is made out of copper, structuresout of steel, cooling racks out of aluminum, and batteries out of lithium — and demand for these inputs continues to rise.
Prices on copper are up more than 34% yearto date, while hot-rolled coil (HRC) steel and aluminum have climbed by 27% and 14%, respectively, according to data from Trading Economics. The price of lithium has also risen 30%.
'We're just not going to have enoughsupply'
Demand from the AI revolution, the energytransition, and other industries is one side of the equation pushing prices for these metals higher. But supply pressures have also driven industrial metals' prices upward throughout the year.
Copper, for instance, has seen its globalsupply hampered by a series of environmental disasters.
In May 2025, flooding at Ivanhoe's (IVN.TO)Kamoa-Kakula complex in the Democratic Republic of Congo temporarily halted production at one of the world's largest mines. Only months later, a tunnel collapse at a major mining complex in Chile and a mudslide at Freeport-McMoRan's (FCX) Grasberg mine in Indonesia further choked global output.
In the lithium market, a temporarysuspension of operations enacted by the Chinese government at one of Chinese battery maker CATL's (3750.HK) major mining sites sent prices soaring.
In the aluminum and steel markets, risingenergy prices driven by the war in Ukraine and the advent of AI have limited the operations of refiners around the world. China is also approaching its production cap in aluminum, ING Bank noted in a research memo.
"When there's geopolitical riskcropping up, or something with a government doing export bans to try and raise prices, this is a direct beneficiary of price appreciation," Wiederhold told Yahoo Finance.
The Trump administration tariffs have alsocreated volatility in the metals markets.
Imports of both steel and aluminum arecurrently subject to a 50% tariff. In copper, semi-finished products and copper-intensive goods, such as wiring or tubes, are covered under an identical
50% tariff, although raw copper ores are excluded.
When President Trump announced plans inJuly to impose tariffs on copper, traders rushed to move physical copper stores out of warehouses overseas and back into the US to avoid these duties, which sent prices soaring. When the administration clarified that these tariffs would not apply to raw copper ore, prices came back down.
Now, an expected supply shortage in copperand an uptick in requests to withdraw copper from LME warehouses have "exacerbated [fears] over a global supply shortage," LPL Financial chief technical strategist Adam Turnquist said.
The commodity trading house Glencore(GLNCY), one of the world's largest metals traders, is now preparing to boost its copper production from roughly 850 kilotons (kt) of output this year to
1,000 kt in 2028 and 1,600 kt by 2035, according to research from Jefferies. Indonesian aluminum smelters, seeking to capitalize on a surge in demand, have been expanding their refining capacity for the metal.
"We've seen trading desks setting upphysical exposure," Bloomberg head of commodities and crypto index products Jigna Gibb said. "When it gets physical, energy and industrial metals are the key ones where you see a lot more positioning."
This interplay between financial andphysical markets is only one part of the story for the metals complex, with the overarching demand from the AI build-out wielding just as much influence on both prices and planning for miners, refiners, and investors.
For aluminum, which requires enormousamounts of cheap energy to refine, the expected growth rate in AI-driven electricity demand is primed to cut into smelters' margins and send prices skyward. Power grid expansion, data centers, and wiring inside AI chips and semiconductors are all expected to push demand for copper and steel up and to the right.
Lithium, supply-constrained by China, isused in everything from the energy transition and electric vehicles to battery storage.
The world is increasingly "powered bytechnologies consisting of metals," Bloomberg's Wiederhold told Yahoo Finance.
"We're just not going to have enoughsupply for the projected demand."