Copper hit $10 000 a ton for the first time in two years as speculation builds that the world’s mines will struggle to meet a coming wave of demand from green industries.

The metal reclaimed its hold on five figures in London after a pick-up in global manufacturing activity, as well as flashes of tightness in mine supply, helped fuel gains in recent months. But the advance is also emboldening copper bulls like BlackRock and Trafigura Group, who say the metal will have to jump even higher to spur the creation of new mines.

Traders are optimistic about demand growth as millions of tons of new supply are set to be needed in coming years for use in electric vehicles, renewable energy, and vastly expanded power grids just as major mines get more expensive to build or expand.

Futures rose as much as 1.4% to $10 000 a ton on the London Metal Exchange on Friday, the highest level since April 2022. The latest upswing means that benchmark prices have rallied by 17% this year.

This year’s advance has been supported by cautious optimism on the global economy, even as expectations for lower US interest rates have been pushed back. In China, the world’s biggest consumer, first-quarter growth beat estimates, helping to support demand.

On the supply side, copper would need to reach $12,000 a ton to spur large-scale investments in new mines and stave off future deficits, according to Olivia Markham, who co-manages the BlackRock World Mining Fund.

Still, some participants have pointed to a mismatch between copper’s bullish form on futures markets and a more cautious picture in physical trading. Premiums are fading, inventories remain relatively high, and spot prices have been at a discount to futures for a prolonged period, a contango structure that indicates adequate supply.

In a signal of the attractiveness of copper assets, BHP Group proposed a takeover of Anglo American, a deal that would create the world’s top copper producer with about 10% of global mine supply.