Rio Tinto or BHP shares? Expert says which stock to buy as copper price smashes record

The copper price hit new all-time highs on Wednesday, with trading on the London Metal Exchange seeing copper futures climb above $11,400 per tonne for the very first time.

Overall, the global benchmark copper price in London has now increased by more than 30% since the start of the year.

For context, the All Ordinaries Index (ASX: XAO) is up by about 5% across the same period.

And copper could also be an attractive investment in 2026, according to Jun Bei Liu, founder and lead portfolio manager at Sydney-based hedge fund Ten Cap.

Critical metal

Copper is one of the most important metals of the modern-day world.

It boasts mass industrial applications thanks to its ductility, malleability, resistance to corrosion, and its thermal and electrical conductivity.

Such properties make the metal a key ingredient in a wide array of applications, including construction, power grids, transportation, and consumer electronics.

And as the world electrifies, its strategic value is growing.

For example, electric vehicles use roughly four times more copper than traditional cars, and AI data centres rely heavily on the metal for power distribution and cooling.

Some of the world’s biggest mining companies have also been growing their exposure to the metal in recent years.

These include ASX 200 mining heavyweights BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO).

And some analysts are also predicting a bright future for the metal.

Expert viewpoint

As reported in the Australian Financial Review, Jun Bei Liu believes that the structural demand for copper makes the metal one of the market’s most compelling trades for next year.

In particular, she cited the global energy transition as a key catalyst:

It’s almost like copper is the tech of the resources [sector] – the exciting part…

The demand needed for the energy transition is increasingly interesting. And should there be any sell-off, you’ve certainly seen a lot of support for copper and copper equities.

Curiously, Liu noted that she favours mid-cap ASX 200 mining stocks with an exclusive focus on copper over the diversified mining giants.

Here, she pointed to Capstone Copper Corp CDI (ASX: CSC) and Sandfire Resources Ltd (ASX: SFR), with the duo in the “sweet spot”, given their correlation to rising copper prices.

Two ASX 200 pure-play copper miners

Sandfire is a copper-focused mining stock with two producing assets.

In FY25, it churned out 94,000 tonnes of copper equivalent from its MATSA operations in Spain.

It added another 58,000 tonnes equivalent from its Motheo mine in Botswana.

Sandfire shares have jumped by 76% since the start of the year to $16.34 at Wednesday’s close.

Meanwhile, Capstone is a Canadian-based copper miner with several producing assets in the Americas.

In 2025, the company is targeting output of between 220,000 and 255,000 tonnes of copper.

Since early January, its share price has increased by 30% to $13.19 per share at yesterday’s close.

Rio Tinto or BHP shares?

Out of the two biggest ASX 200 mining stocks, Liu said she preferred Rio Tinto ahead of BHP shares.

Here, she believes that Rio Tinto offers a more attractive valuation and fewer strategic risks.

Since the start of the year, shares in Rio Tinto have lifted by 14% to reach $135.28 per share.

In comparison, BHP shares have risen by 7.5% during the same period to $42.96 apiece at the close of trading on Wednesday.

The post Rio Tinto or BHP shares? Expert says which stock to buy as copper price smashes record appeared first on The Motley Fool Australia.

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Motley Fool contributor Bart Bogacz has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.