Copper, the metal that underpins the fast-growing renewable energy industry, is on course for its biggest annual price rise in more than 15 years as traders react to fears of global shortages.
As one of the main beneficiaries of the “electrification of everything”, copper has soared by more than 35% in value this year, spurred by US tariff uncertainty and concerns about mining disasters that could restrict supply.
Analysts said copper had also joined silver and gold as a safe haven asset for investors wanting to hedge against the falling value of the dollar.
Silver reached a record high on Monday, pushing the value of the Mexican mining company Fresnillo, which is listed on the London stock market, to a record high this month. The price of gold has jumped above $4,400 (£3,263) an ounce, up more than 70% since the beginning of January.
Kyle Rodda, a senior financial market analyst at the investment company Capital.com, said the rise of copper, gold and silver demonstrated “a world marked by greater scarcity and investors’ desire to get their hands on things with relatively limited supply”.
The price of copper increased to more than $12,000 a tonne in December after the biggest rise since the global recovery that followed the 2008 financial crash.
There was a rush to buy copper by US companies earlier this year after Donald Trump threatened to slap extra tariffs on imports of the metal. The tariffs were suspended, but the hoarding effect has limited supplies in other parts of the world and helped drive global prices higher.
Copper is often viewed as a barometer for the global economy. It plays a central role in power grids, construction and industrial machinery.
China, which is the largest manufacturer of copper products, has made securing supplies a priority, adding to the rise in prices.
On Christmas Day, the state-owned miner Jiangxi Copper said it had acquired all shares of the London-listed mining firm SolGold for $1.2bn, allowing it to take control of the Cascabel gold and silver mining operation run by SolGold in Ecuador.
Analysts at Goldman Sachs said earlier this month that the copper price was likely to stabilise in response to figures that showed there was more than enough of the metal in circulation to meet global demand.
However, concerns have grown that short-term hoarding in the US and China, and the rising demand for copper over the next two decades will mean supply fails to keep pace, especially as countries seek to switch from oil and gas to renewable sources of energy such as wind and solar farms.
However, several mines have recently been forced to shut down after accidents.
The US miner Freeport-McMoRan said in September it would be unable to fulfil contracts to customers after a fatal mudslide at its sprawling Grasberg copper and gold mine in Indonesia.