Southern Copper (SCCO)
#2 pure-play copper producer (lowest-cost, largest reserves) — the copper-supercycle play; copper is the volume bottleneck for AI power/cooling/grid
AI exposure 2% — derived from reported segment revenue, not asserted.
Where it sits
Energy Supply & Critical Minerals → Critical Minerals & Base Metals · figures rebased to Q2 2026, reported 2026-07-22
Critical mineral/metal feeding the AI buildout
Reported segments
- Copper (primary) — 72.7% of revenue
- By-products (molybdenum, silver, zinc, other) — 27.3% of revenue
Southern Copper ($4.29B Q2 2026 — a record, with net income up 71.6% to $1.67B). Copper 72.7% = primary B4 Critical Minerals & Base Metals; by-products 27.3% (molybdenum 11.1%, silver 8.8%, zinc 3.5%, other including gold and sulphuric acid 3.9%). The by-product share has risen from 20% as molybdenum and silver prices moved.
How the 2% is built
- Copper (primary) — 72.7% of revenue × 3% AI-driven (disclosed). Copper is essential to data-centre power distribution and grid build-out, but the same metal serves construction, vehicles and every other electrical use
- By-products (molybdenum, silver, zinc, other) — 27.3% of revenue × 0% AI-driven (disclosed). Molybdenum, silver and zinc have no specific AI linkage
Investment read
Moat. Bottom-of-the-cost-curve orebodies with 35+ years of reserve life — the advantage is geology and by-product endowment, not anything commercial. Q2 2026 adjusted EBITDA margin of 66.6% is the highest among large-cap copper peers and is structural, though the headline $0.05/lb net cash cost is flattered by peak silver and moly credits (FY2025 was $0.58/lb).
Bottleneck / pricing power. A price-taker with no pricing power — Q2 2026 growth was entirely price-led ($6.04/lb LME average, +30% YoY) while copper production fell 3.5% QoQ on lower Peruvian ore grades. What the cost position buys is survival of the spread: at roughly 2B lbs sold a year a $0.50/lb move swings EBITDA by about $1B, but SCCO stays cash-generative where higher-cost peers do not.
Role in the AI stack. The volume-metal supplier — copper underpins every watt delivered to a data center.
Connected companies
- Eaton Corporation (ETN) — SCCO supplies: copper for Eaton electrical/power equipment
- Schneider Electric (SU) — SCCO supplies: copper for Schneider power/grid equipment
- Hubbell (HUBB) — SCCO supplies: copper for Hubbell electrical products
- GE Vernova (GEV) — SCCO supplies: copper for GE Vernova grid/transformers
- Freeport-McMoRan (FCX) — SCCO competes with: copper — Southern Copper vs Freeport (the two largest pure-play copper majors)
- Powell Industries (POWL) — SCCO supplies: copper for Powell switchgear/power-distribution
- Caterpillar (CAT) — SCCO is supplied by: mining equipment for Southern Copper mines
- Amphenol (APH) — SCCO supplies: Copper (via commodity cathode chain) is the dominant raw input; no direct SCCO-Amphenol supply named
- TE Connectivity (TEL) — SCCO supplies: Copper alloy (via commodity cathode chain) is TE's largest raw-material exposure; no direct SCCO-TE supply named
- Credo Technology (CRDO) — SCCO supplies: Copper twinax conductor (via commodity/cable-supplier chain) in AECs; no direct SCCO-Credo supply named
- Taiwan Semiconductor (TSM) — SCCO supplies: Copper for damascene BEOL interconnect (via high-purity refiners); no direct SCCO-TSMC supply named
- Intel (INTC) — SCCO supplies: Copper for interconnect and packaging substrates (via high-purity refiners); no direct SCCO-Intel supply named
- GlobalFoundries (GFS) — SCCO supplies: Copper for BEOL metallization (via high-purity refiners); no direct SCCO-GlobalFoundries supply named
- Micron Technology (MU) — SCCO supplies: Refined copper (via commodity market and plating-chemistry suppliers) underlies Micron's DRAM/HBM interconnect plating; indirect, unnamed relationship
Others in Critical Minerals & Base Metals
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