Industrial metals
Why aluminum, copper and nickel are so expensive
Whether smartphone, wind turbine or electric car: without industrial metals, many products and technologies would not exist. Prices are currently rising. What’s behind it?
It’s not just the price of gold that has repeatedly reached record highs in recent weeks. This also applies to metals used in industrial production. For example, the price of copper broke the $13,000 mark at the beginning of the year, after having already increased by over 40 percent in 2025. And other metals have also recently become more expensive.
“Without industrial metals, many products and modern technologies would not exist,” says Mirko Schmidt from Berenberg Bank in an interview with ARD financial editorial team. Car manufacturers need aluminum for vehicle bodies. Iron is used in the construction of buildings and bridges. Copper is essential in electrical and medical engineering, and nickel is often used as a catalyst. For many economists, industrial metals are something like the “cornerstone of the economy.”
Fluctuating prices
It is normal for prices to fluctuate in the raw materials sector. Among other things, this is due to the fact that metals are not just lying in the ground, but have to be extracted and processed using complicated and often expensive processes before they are used in industry.
“When the economy is booming, construction and production take place, and demand increases accordingly. When the engine stalls, prices fall,” explains Stephan Kemper from BNP Paribas. “One problem is that we have a rigid supply. You can’t turn a mine on and off like a light switch. And that’s why fluctuations in demand are immediately reflected in the price.”
In addition, wars or sanctions can make trading in industrial metals more difficult. The same thing happens when natural disasters occur, as recently happened in New Guinea. In the fall of 2025 there was a huge landslide on the island. Tons of mud were washed into the Grasberg mine. This is one of the world’s largest copper and gold mines. Workers died. Copper production had to be stopped. As a result, global copper supply chains were massively affected. “This of course reduces supply and ultimately increases prices,” says Schmidt from Berenberg Bank.
The “green revolution” is increasing the hunger for metal
Copper is still very expensive. This also applies to nickel and aluminum. “This is unlikely to change any time soon,” believes Kemper from BNP Paribas. “Because of the energy transition, we need a lot of copper – for example for power cables. We need nickel for batteries and aluminum for cars.” It is foreseeable that the transformation of the economy towards CO2 neutrality will take decades. So demand remains high. At the same time, far too little was invested in new mines for years. The supply is scarce.
The economic-political showdown on the international stage is also likely to influence prices, points out Thomas Benedix from Union Investment. “The current geopolitical uncertainty and uncertainties surrounding US tariff policy are causing many physical market participants to stock up on metal to make their supply chains more resilient.” Some metals are literally hoarded.
Industrial metals as a power factor
Industrial metals are something like a mirror of the global economy. Depending on which raw materials are in demand, this says a lot about the direction and areas in which the economy is developing. Industrial metals are also a power factor. For many politicians and entrepreneurs it is now about having and maintaining control over the coveted raw materials. The age of cheap industrial metals is over for the time being.
