Copper Is Near Record Highs as AI Demand Surges. The World May Still Be 10 Million Tons Short

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1. Galway Metals Inc. is a billboard sponsor of Streetwise Reports. The company pays a monthly sponsorship fee of US$3,000–US$6,000 for banner advertising and an enhanced company profile page. Streetwise Reports’ editorial content is fully independent and is not influenced by sponsorship.
2. As of the date of this article, officers, contractors, shareholders, and/or employees of Streetwise Reports LLC (including members of their household) own securities of Galway Metals Inc.
3. James Guttman wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Copper entered September near record territory as tight inventories, mine disruptions, tariff-driven trade flows, and expectations for sharply higher long-term demand reinforced the investment case for the industrial metal. Copper traded above US$14,300 per metric ton on the London Metal Exchange in late August and was up about 15% for 2026, according to an August 28 Bloomberg report. The metal has become increasingly important to the buildout of power grids, electric vehicles, renewable energy infrastructure, and artificial intelligence data centers, all of which require substantial amounts of copper for electrical equipment, transmission, and connectivity.

That demand is expected to accelerate over the longer term. S&P Global projected global copper demand could rise approximately 50% to 42 million metric tons by 2040 from 28 million metric tons in 2025. The same study projected a potential 10 million metric ton supply deficit by 2040 as rising consumption encounters constraints on new mine development and production. Bloomberg also pointed to the performance of copper equities as investors positioned around that outlook, with the Solactive Global Copper Miners Index gaining approximately 35% since the beginning of 2026.

Copper Inventories Tighten as Prices Approach Records

Near-term market conditions have added another layer to the longer-term supply story. Investing News Network reported on August 31 that available copper stocks at London Metal Exchange warehouses fell to 107,050 metric tons on August 26 from 166,775 metric tons on August 19, a decline of nearly 36% in one week. Shanghai Futures Exchange inventories also fell 19.1% to 72,428 metric tons.

The United States has moved in the opposite direction, with inventories reaching a record 758,889 short tons as traders accelerated imports ahead of a planned 15% tariff on refined copper beginning January 1, 2027. The resulting movement of metal into the United States has contributed to tighter supplies elsewhere as uncertainty surrounding future U.S. trade policy continues to influence global copper flows.

Prices reflected those conditions throughout August. The three-month LME copper contract reached US$14,370 per metric ton on August 28, just below the US$14,527.50 intraday record reached on January 29. U.S. copper closed August 28 at US$6.66 per pound after reaching an intraday record of US$6.90 per pound earlier in the month.

Supply disruptions have provided additional support. Codelco halted development of the Andes Norte expansion at its El Teniente operation in Chile in August because of seismic risks, while production at the existing operation during the first five months of 2026 was reportedly 27% below the comparable 2025 period. Two other major copper operations, Grasberg in Indonesia and Kamoa-Kakula in the Democratic Republic of the Congo, continued recovering from disruptions suffered in 2025 and were not expected to return to full production until sometime in 2027.

Copper producers have also faced higher input costs associated with the continuing closure of the Strait of Hormuz and elevated energy prices. Investing News Network cited analysis using Wood Mackenzie data indicating copper production costs rise approximately 3.5% for every 10% increase in oil prices. Brent crude moved above US$91 per barrel on August 30 as renewed hostilities pushed energy prices higher.

Record Market Positioning Adds a Note of Caution

Despite the bullish supply-and-demand backdrop, market positioning suggested copper's recent rally had become increasingly crowded. Thomas Lukacs wrote for Kitco on August 31 that combined copper futures and options positioning had reached its most extreme level in data extending back to 1995, with both Commercial and Large Speculator net positions at record extremes.

Lukacs said the conventional interpretation of such positioning was bearish and pointed to May 2024, when an extreme reading developed around a copper market top before prices declined. He cautioned, however, that positioning extremes do not provide a precise timing signal and noted an important historical exception.

Copper experienced a similarly unprecedented positioning extreme in 2003 but continued rising. Lukacs described that scenario as "commercial capitulation," in which continued price gains can put increasing pressure on commercial participants holding short futures hedges. If those positions eventually have to be reduced, the buying required to close them can provide additional support to an already rising market.

Lukacs said a conventional pullback remained his base case, particularly because speculative positioning across gold, silver, copper, platinum, and palladium was also stretched. However, the 2003 precedent meant continued copper strength despite record positioning, which could point to an unusually powerful market rather than an immediate top.

The competing signals leave copper entering September with prices near historic highs and speculative positioning at unprecedented levels, but against a fundamental backdrop characterized by falling inventories outside the United States, disrupted mine supply, and expectations that AI infrastructure, power-grid expansion, and electrification could require substantially more copper over the coming decade.

Against that backdrop of tightening supply, rising long-term demand, and copper prices near historic highs, investors are paying closer attention to companies positioned within the sector. Galway Metals Inc. is one of the companies operating in this increasingly important market.

Galway Metals

Galway Metals Inc. (GWM:TSX.V; GAYMF:OTCQB) is advancing its Clarence Stream gold project in New Brunswick while continuing work at the polymetallic Estrades Project in Quebec. At Clarence Stream, the company recently reported assays from 14 diamond drill holes at the Southwest Deposit, led by 2.0 grams per tonne gold (g/t Au) over 68.0 meters in Hole BL-328. That interval included 54.4 g/t Au over 1.0 meter, while a second interval beginning seven meters below returned 1.0 g/t Au over 52.0 meters.

Other drilling demonstrated additional mineralization across the Southwest. Hole BL-311 returned 3.3 g/t Au over 23.0 meters, including 56.2 g/t Au over 1.0 meter, along with several additional gold-bearing intervals. Hole BL-329 intersected 3.2 g/t Au over 11.0 meters, while BL-294 returned 2.3 g/t Au over 16.0 meters. Galway is conducting infill drilling at approximately 25-meter spacing to increase confidence in the existing resource while also testing areas beyond the current resource model.

"These latest results continue to demonstrate the impressive widths and continuity of gold mineralization within the Southwest Deposit," President and CEO Rob Hinchcliffe said. He highlighted BL-328 in particular, noting the 68-meter interval and the additional 52-meter interval encountered shortly below it.

Clarence Stream's updated Mineral Resource Estimate contains 1.42 million ounces of gold in the Indicated category and 1.29 million ounces in the Inferred category, for approximately 2.7 million ounces overall. The estimate incorporated roughly 70,000 meters of additional drilling from 342 holes and represented an increase of approximately 450,000 ounces, or 20%, from the 2022 resource. Approximately 88% of the updated resource is contained within optimized open-pit shells.

Red Cloud Securities analyst Ron Stewart reiterated a BUY rating and CA$2.20 per share target price for Galway in a July 14 research note following the resource update. Stewart highlighted the 54% increase in Indicated gold ounces, as well as growth in the project's antimony resource. Indicated contained antimony doubled to approximately 19,500 tonnes, while metallurgical testing cited by Stewart produced gold extraction rates of 85% to 98% and antimony recoveries of up to approximately 84%.

Galway has since engaged BBA E&C Inc. to complete a Preliminary Economic Assessment for Clarence Stream, targeted for the first quarter of 2027. According to the company's August corporate presentation, PEA work includes pit optimization, preliminary mine scheduling, and economic modeling, along with additional metallurgical, geotechnical, and rock-characterization studies.

Exploration is continuing alongside that development work, with four drill rigs operating at Clarence Stream. Two are focused on adding ounces at the South Deposit, while others are testing targets along the corridor between the South and Southwest deposits and elsewhere on the property. Galway has identified a 12-kilometer interpreted fold trend linking South and Southwest, including approximately 6 kilometers that have not yet been drill tested, as well as 12 high-priority regional targets elsewhere along the project's 65-kilometer trend.

Galway also provides exposure to the copper market through its Estrades Project in Quebec, a gold-zinc-copper-silver volcanogenic massive sulphide deposit. Phase 1 of a program funded by DOWA Metals & Mining Co. is underway and includes 5,000 meters of drilling for geological and metallurgical purposes, additional metallurgical testing, and baseline studies. Under an Option and Joint Venture Term Sheet, DOWA can earn up to a 45% participating interest in Estrades through three phases involving contributions of as much as US$25 million. Following the Estrades PEA released in January 2026, Galway's near-term work is focused on further optimization of the project.

¹Insiders hold 7.31% of Galway, including 6.62% held by CEO Rob Hinchcliffe. Institutional ownership totals 18.52%, led by Van Eck Associates Corp. at 4.45%, Caisse de dépôt et placement du Québec at 3.33%, and Mackenzie Investments at 3.27%. The remainder of the shares are held by retail investors.

Galway has approximately 135.87 million shares outstanding and a market capitalization of approximately CA$89.68 million. The company's 52-week trading range is CA$0.41 to CA$1.01 per share. 

Frequently Asked Questions

Why are copper prices near record highs in 2026?

Copper prices have been supported by tightening global inventories, mine supply disruptions, changing U.S. tariff policy, and expectations for growing demand from artificial intelligence data centers, power grids, electric vehicles, and renewable energy infrastructure. Copper traded above US$14,300 per metric ton on the London Metal Exchange in late August 2026.

How is the AI data center boom affecting copper demand?

AI data centers require large amounts of electricity and electrical infrastructure, making copper important for power transmission, wiring, cooling systems, and grid expansion. The rapid buildout of AI infrastructure is adding another source of demand to an already tight long-term copper market.

Is the world facing a copper supply shortage?

S&P Global has projected global copper demand could rise approximately 50% to 42 million metric tons by 2040, compared with 28 million metric tons in 2025. Its projections indicate the market could face a supply deficit of approximately 10 million metric tons by 2040 as demand growth outpaces new mine supply.

Why are copper inventories falling in 2026?

London Metal Exchange copper inventories fell sharply in August, while Shanghai Futures Exchange inventories also declined. At the same time, copper has accumulated in the United States as traders moved metal ahead of a planned 15% U.S. tariff on refined copper beginning January 1, 2027, contributing to unusual regional inventory imbalances.

What could drive copper prices higher from here?

Potential copper price catalysts include continued AI data center construction, power-grid investment, electrification, declining inventories, and further disruptions at major copper mines. Constraints on developing new mines could become increasingly important if global copper consumption continues rising as projected.

What are the risks to the copper price outlook?

Copper prices are already near historic highs, and speculative positioning has reached unusually stretched levels. Thomas Lukacs of Kitco noted in August that copper futures and options positioning had reached its most extreme level in data going back to 1995, potentially increasing the risk of a pullback even as longer-term supply-and-demand fundamentals remain supportive.

What is Galway Metals Inc.?

Galway Metals Inc. is a mineral exploration and development company advancing the Clarence Stream gold project in New Brunswick and the Estrades gold-zinc-copper-silver project in Quebec.

Does Galway Metals have exposure to copper?

Yes. Galway Metals has copper exposure through its Estrades Project in Quebec, a polymetallic volcanogenic massive sulphide deposit containing gold, zinc, copper, and silver. Work at Estrades is continuing following the project's January 2026 Preliminary Economic Assessment.

What is happening at Galway Metals' Estrades copper project?

Galway Metals said Phase 1 of a program funded by DOWA Metals & Mining Co. is underway at Estrades. The program includes 5,000 meters of drilling, metallurgical testing, and baseline studies as the company works to further optimize the project.

What is DOWA Metals & Mining's agreement with Galway Metals?

Under an Option and Joint Venture Term Sheet, DOWA Metals & Mining Co. may earn up to a 45% participating interest in Galway Metals' Estrades Project through three phases involving total contributions of up to US$25 million.

What are the latest Galway Metals drilling results?

At the company's Clarence Stream Gold Project, Galway reported August 2026 assays highlighted by 2.0 grams per tonne gold over 68.0 meters in Hole BL-328 at the Southwest Deposit. The interval included 54.4 g/t gold over 1.0 meter, and another interval beginning seven meters below returned 1.0 g/t gold over 52.0 meters.

How large is Galway Metals' Clarence Stream gold resource?

The updated Clarence Stream Mineral Resource Estimate contains approximately 2.7 million ounces of gold, including 1.42 million ounces in the Indicated category and 1.29 million ounces in the Inferred category. The total resource increased by approximately 450,000 ounces, or 20%, compared with the 2022 estimate.

What are the next catalysts for Galway Metals?

Near-term catalysts include continued drilling at Clarence Stream, exploration of targets outside the existing resource, ongoing technical and metallurgical work, advancement of the Estrades program, and completion of the Clarence Stream Preliminary Economic Assessment, which is targeted for the first quarter of 2027.