As the artificial intelligence sector expands, the demand for essential commodities, particularly copper, is surging, presenting a significant investment opportunity. Bank of America Corp. (BofA) emphasizes that traditional tech investments should be complemented with commodities to capitalize on this trend. The strategists, led by Michael Hartnett, argue that commodities stocks provide a more cost-effective and diversified approach to gaining exposure to the AI boom than investing in high-priced mega-cap tech companies. With miners outperforming major tech benchmarks, the resource sector is poised to benefit from the increasing demand driven by AI applications.
The implications of this shift are profound, as copper emerges as a critical component in technologies such as electric vehicles and renewable energy systems, which are integral to the AI infrastructure. BloombergNEF forecasts a significant copper shortage by 2035, with AI-related consumption projected to average 400,000 metric tons annually. As demand outpaces supply, copper prices could soar to $13,500 per ton by 2028, underscoring the necessity for investors to consider resource stocks as a strategic hedge against the evolving landscape of technology and energy consumption.
