Australiaās mining stocks set to extend rally on rising copper demand
BHP's copper earnings overtook iron ore for the first time as AI data centers and electrification reshape the investment landscape for Australian miners.
Copper prices surpassed US$14,700 per tonne in September 2026, roughly US$6.74 per pound, representing a historic high for a metal that has long played second fiddle to iron ore in Australia’s mining hierarchy.
The price surge reflects a supply-demand imbalance that’s been building for years. On the demand side, data centers built to power AI workloads are extraordinarily copper-hungry. A standard 230 MW data center requires approximately 10,000 tonnes of copper, covering everything from power cabling to cooling systems to grid connections.
BHP’s billion-dollar pivot
BHP, Australia’s largest mining company by market capitalization, offers the clearest illustration of how dramatically the landscape has shifted. In FY26, the company’s copper earnings reached US$18.2 billion, overtaking iron ore revenue for the first time in BHP’s modern history.
BHP has earmarked more than half of its growth capital expenditure for future copper projects. Rio Tinto has been amplifying its copper exposure as well.
Sandfire Resources, a mid-cap copper producer, watched its share price climb more than 90% in the twelve months leading to September 2026. The company’s market capitalization now sits above A$8 billion.
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Why AI changes the equation
Every major tech company on the planet is racing to build or lease data center capacity. Microsoft, Google, Amazon, and Meta have collectively committed hundreds of billions of dollars to AI infrastructure buildouts. Each facility requires massive amounts of copper for electrical systems, and unlike some construction materials, copper doesn’t have a readily available substitute in most of these applications.
Analysts anticipate copper demand will continue climbing through 2027 and beyond as these projects move from planning to construction phases.
The ASX mining and materials sub-index has been the top-performing sector over the past year, powered primarily by copper-related momentum. Iron ore markets are contending with softer demand dynamics as China’s property market works through a prolonged slowdown.