Copper has morphed from a cyclical industrial metal into the backbone of a structural super theme, with prices recently hovering near record territory after jumping more than 40% in 2025 and staying above roughly $13,000 per metric ton on London futures early this year. 

To this end, the S&P Global projects global copper demand to surge 50% by 2040, jumping to an estimated 42 million metric tons (as cited in a Forbes report). 

Such a robust demand, combined with constrained mine growth, is causing a structural supply deficit, underpinning spot prices and strengthening the long-term outlook for copper. For investors seeking to position themselves for this multi-decade theme without being exposed to single-stock-specific risks, targeted copper exchange-traded funds (ETFs) provide a straightforward way to gain diversified exposure to the red metal’s upside.

Before adding such ETFs to your portfolio, it is important to understand the specific catalysts behind this “Copper Crunch” and why a basket approach may be a prudent strategy. Doing so will help you make a more informed investment decision.

What’s Driving Copper Demand?

The primary engine driving this demand is undoubtedly the global energy transition. Copper is the metal of electrification, with everything from electric vehicles (EVs) to solar farms requiring it in vast quantities.

For example, S&P Global Vice Chairman Daniel Yergin highlighted in a recent interview with CNBC Television that an electric car uses significantly more copper (roughly 2.9% more) than a conventional internal combustion engine vehicle.

The second most important catalyst reshaping the demand pool for Copper is the humongous demand for electricity generated from the skyrocketing number of artificial intelligence (AI) models being built.  AI-driven data centers require immense amounts of power, and that power must be transmitted and managed using extensive copper-intensive electrical infrastructure. 

This dual demand from electrification and AI is creating a powerful tailwind for demand, reinforcing copper's critical role in the modern economy as well as reshaping the mining industry's hierarchy. Evidently, BHP Group BHP, one of the world’s largest mining companies, recently reported that copper has officially displaced iron ore as its primary profit driver, accounting for 51% of its total underlying earnings in its latest half-year results. 

Other pure-play copper miners like Freeport McMoRan FCX and Southern Copper SCCO have also witnessed a strong rally in their share prices lately, reflecting Wall Street’s favorable reaction to rising copper prices.

Why ETFs & Not Individual Miners?

Considering the aforementioned discussion, investing directly in a copper miner can be lucrative, but it comes with company-specific risks. For instance, a miner might face a sudden regulatory hurdle in a key jurisdiction, a labor strike at a primary mine, or significant cost overruns on a new expansion project—all of which can hammer the stock price even if copper prices remain strong. Thus, a single operational setback can wipe out an investor's gains.

A copper ETF effectively sidesteps this "single-stock risk." By holding a diversified basket of miners — from global giants to smaller developers — and potentially copper futures contracts, the ETF helps smooth out volatility caused by issues at any single company.

Copper ETFs to Consider

For investors looking to capitalize on the anticipated demand surge of copper, here are a few ETFs to consider:

Global X Copper Miners ETF COPX

This fund, with assets worth $7.49 billion, provides exposure to 41 copper mining companies. Its top three holdings include Lundin Mining LUNMF (6.11%), Sumitomo Metal Mining SMMYY (5.73%), and Boliden AB (5.43%). 

COPX has surged a solid 24.1% year to date. The fund charges 65 basis points (bps) as fees. It traded at a good volume of 3.99 million shares in the last trading session.

iShares Copper and Metals Mining ETF ICOP

This fund, with net assets worth $455.7 million, provides exposure to 47 global copper and metal ore miners. Its top three holdings include FCX (8.42%), BHP (7.91%) and Anglo American NGLOY (7.90%). 

ICOP has soared 22.3% year to date. The fund charges 47 bps as fees. It traded at a volume of 0.16 million shares in the last trading session.

United States Copper ETF (CPER

This fund, with net assets worth $875.5 million, reflects the performance of the investment returns from a portfolio of copper futures contracts on the COMEX exchange. CPER has gained 3.4% year to date. 

The fund charges 106 bps as fees. It traded at a volume of 0.59 million shares in the last trading session. 

Sprott Copper Miners ETF COPP

This fund, with net assets worth $288.8 million, provides exposure to physical copper and 63 copper miners. Its top three holdings include FCX (25.70%), Teck Resources TECK (9.90%) and Antofagasta plc (9.40%). 

COPP has rallied 19.3% year to date. The fund charges 65 bps as fees. It traded at a volume of 0.31 million shares in the last trading session. 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Freeport-McMoRan Inc. (FCX) : Free Stock Analysis Report

BHP Group Limited Sponsored ADR (BHP) : Free Stock Analysis Report

Southern Copper Corporation (SCCO) : Free Stock Analysis Report

Global X Copper Miners ETF (COPX): ETF Research Reports

Lundin Mining Corp. (LUNMF) : Free Stock Analysis Report

Teck Resources Ltd (TECK) : Free Stock Analysis Report

Anglo American (NGLOY) : Free Stock Analysis Report

iShares Copper and Metals Mining ETF (ICOP): ETF Research Reports

Sprott Copper Miners ETF (COPP): ETF Research Reports

Sumitomo Metal Mining Co., Ltd. – Unsponsored ADR (SMMYY) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research