Ivanhoe Electric CEO says copper can weather an AI stock pullback

A retreat in AI stocks does not have to derail copper’s rally, Ivanhoe Electric CEO Taylor Melvin told CNBC in comments published October 20. His case rests on technology and defense buyers continuing to need the metal despite market volatility—a bullish assessment as copper’s 2026 gain reaches 15.8% and investors question the durability of AI spending.

Speaking on CNBC’s Squawk Box Europe, Melvin described technology demand for copper as almost “inelastic”: demand that is relatively insensitive to the metal’s price. He argued that a large technology company is unlikely to base a decision about building a very large data center on the cost of copper.

He sees a similar pattern in national security and defense budgets. In his account, these buyers represent another emerging source of demand alongside AI infrastructure. Countries and industries are increasingly focused on securing metals for national security, economic growth and technology infrastructure, a shift he said has supported copper prices.

The distinction is between a change in investors’ willingness to pay for technology shares and continued growth in the industries using copper. Melvin acknowledged the retreat in technology valuations but said those industries could still generate additional demand. His comments come from the head of a mining and exploration company whose focus includes copper.

The price performance gives that argument a substantial rally to defend. Copper was up 15.8% for the year and more than 30% over the preceding 12 months, according to CNBC’s October 20 snapshot. The metal is used in electronics, construction and transportation, giving it exposure beyond the AI infrastructure buildout.

Demand is only one part of the bullish case. Iain Pyle, senior investment director at Aberdeen Investments and co-manager of the abrdn Future Minerals Fund, pointed to supply constraints in an October 15 note cited by CNBC. He described copper as the clearest example of a market where supply cannot keep up with demand.

Pyle said the prospect of U.S. tariffs had drawn a large share of the world’s copper into U.S. storage. It was unclear whether those stocks would be available to the rest of the market, he said. At the same time, he described Chinese inventories as exceptionally low, with premiums there rising.

The policy remains unsettled. In 2025, the U.S. Commerce Department recommended a 15% tariff on refined copper starting January 1, 2027. No final decision had been publicly announced as of CNBC’s report. That leaves the proposed levy, rather than an enacted tariff, as part of the explanation for where inventories are being held.

Pyle’s outlook also carries a near-term warning: tariff announcements could trigger a price pullback. Even so, he argued that sustained higher prices would be needed to encourage supply and that the potential for a price spike had increased. His supply argument complements Melvin’s demand case, but neither is a guarantee against a reversal.