Copper could emerge as biggest winner as AI demand, supply risks lift metals: Nirmal Bang

Kunal Shah, VP-Head of Commodities Research at Nirmal Bang Securities, has identified copper as the top-performing commodity in the near term, driven by rising demand from artificial intelligence (AI) investments and tightening global supply. Copper is critical for data centers, power infrastructure, electric vehicles, and advanced electronics, aligning with the AI and energy transition themes. Shah expects prices to test $15,000 per metric ton, while aluminum and nickel may also benefit from strong industrial demand. Supply constraints are a key factor, with Shah warning that export restrictions—such as those imposed by Indonesia—could further reduce global copper availability. He described market dips as buying opportunities, emphasizing long-term fundamentals despite geopolitical tensions. Meanwhile, crude oil prices are expected to remain under pressure due to growing expectations of a US-Iran diplomatic deal, which could ease West Asia tensions. Shah noted that oil has repeatedly failed to sustain gains, signaling trader confidence in a potential agreement. A softer oil environment may also support the Indian rupee, potentially appreciating toward 94.50 if prices cool further and RBI measures continue. On precious metals, Shah anticipates short-term weakness for gold and silver due to weak seasonal demand in India and rural consumption concerns tied to monsoon conditions. However, he remains bullish on gold over the long term, expecting a recovery after a temporary correction. The dollar index is projected to ease as inflation concerns stabilize and geopolitical tensions ease, providing additional support for commodity markets. Shah’s outlook highlights copper’s resilience amid broader market shifts, positioning it as a standout performer in the coming months.