Copper demand is rising faster than the industry anticipated, driven by billions of dollars being invested worldwide to modernize and expand power grids for the digital and clean energy revolutions that require vast amounts of electricity.
Meanwhile, supply from major producers including Chile and the Democratic Republic of Congo is constrained by a lack of investment in new mines, setting the stage for a prolonged period of high prices.
Some analysts predict copper prices will hit records above $12,000 a ton before the end of the decade, an increase of 23% from current levels around $9,700 a ton.
Consumers are exploring alternatives, but copper's superior conductivity, durability, and versatility have made it hard to replace.
Grid investment alone is forecast to top $400 billion this year, having set a record high of $390 billion in 2024, according to the International Energy Agency.
“Copper is often a massively underestimated part of grid infrastructure,” said Michael Finch of Benchmark Mineral Intelligence (BMI), pointing to investment needed in the US, the UK and China.
BMI expects copper demand for upgrading power generation and transmission networks globally to rise to 14.87 million metric tons by 2030, up from 12.52 million tons this year.
Bank of America analyst Michael Widmer expects global copper demand to increase 10% to 30.32 million tons by 2030. Widmer expects the global copper market deficit to reach 1.84 million tons in 2030.
Consultancy CRU expects copper demand from data centres to reach 260,000 tons this year, up from 78,000 tons in 2020 and exceeding 650,000 tons by 2030.
Electric vehicles also require significantly more copper than traditional internal combustion engine vehicles. BMI forecasts copper demand for electric vehicles will jump to 2.2 million tons in 2030, compared with 1.2 million tons in 2025.
Prysmian buys 2%–3% of global refined copper production.
Recycling could help sustainability targets as producing refined or secondary copper from scrap can use 65% less energy than primary production. Analysts estimate copper from scrap will rise to 11 million tons in 2030 from around 10 million tons this year.
“You can do all the green energy stuff, but if you don’t have a grid system to support, it will be a challenge,” CRU’s Balla said.— Reuters
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