Global copper demand is exploding as electrification and tech infrastructure push production to its absolute limits this decade
- Global copper demand will outpace supply by millions of metric tons soon, experts warn
- Recycling alone cannot meet growing copper demand over the next two decades
- China dominates nearly half of the global copper smelting and refining capacity
Copper demand continues to rise as electrification expands across transport, power generation, and industrial systems, experts have warned, with potential shortages possibly not too far away.
Electric vehicles, grid upgrades, renewable energy installations, and data center infrastructure all rely heavily on copper for wiring, motors, and interconnects.
Even components closely tied to a CPU and high-speed memory subsystems rely on dense copper pathways at both board and facility levels.
Projected demand and supply gap
Analysts from S&P Global have estimated global demand could reach 42 million metric tons by 2040, representing roughly a50% increase from current consumption levels.
Production is expected to peak much earlier, with S&P Global projecting a maximum output of about 33 million metric tons around 2030 – implying a potential shortfall of close to 10 million metric tons if current trends remain unchanged.
Primary copper mining faces declining ore grades, rising costs, and increasingly complex extraction.
Bringing new mines into use also involves long timescales, averaging 17 years. These delays limit how quickly supply can respond to rising demand, even when prices signal scarcity.
Another recent report from PricewaterhouseCoopers suggested limate change threatens copper mines, which require steady water supplies but often operate in drought-risk regions.
Environmental stress, regulatory hurdles, and capital intensity combine to slow the expansion of new production capacity, and secondary supply from recycled sources cannot close the gap, according to S&P analysis.
While telcos transitioning to fiber-optic cabling may free up 800,000 metric tons of copper wiring, the contribution remains limited.
Recycling is expected to account for only about one-third of the total supply by 2040, even under optimistic collection assumptions.
China holds between 40 and 50% of global copper smelting and refining capacity, creating vulnerabilities tied to geographic concentration.
This concentration amplifies systemic risks across industries dependent on electrical infrastructure, from power grids to servers built around DDR5 memory channels.
Analysts warn this concentration increases exposure to geopolitical shocks and broader supply disruptions.
Similar concerns have previously emerged around rare earth minerals and legacy semiconductor manufacturing.
S&P highlights the need to expand processing capacity beyond existing hubs to reduce dependency on a narrow set of regions.
Some technology leaders, including the Broadcom CEO, say silicon photonics, which uses light instead of copper for connections, will not see widespread use anytime soon.
Others point out that GPUs remain expensive but still rely heavily on copper for wiring, cooling, and power, so demand for copper stays high.
Nvidia-backed photonics startup Ayar Labs targets hyperscale customers with GUC design collaboration, yet these efforts still depend on physical infrastructure that remains copper-intensive.
Primary production remains the only practical path to closing the gap, S&P concludes.
The scale of projected demand growth suggests that without faster permitting, broader investment, and genuine multilateral cooperation, copper constraints are likely to persist.
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