- Global demand for copper will soon exceed supply by millions of tonnes, experts warn
- Recycling alone cannot meet the growing demand for copper over the next two decades
- China dominates nearly half of global copper smelting and refining capacity
Demand for copper continues to rise as electrification expands across transport, power generation and industrial systems, experts have warned, with potential shortages possibly not too far off.
Electric vehicles, grid upgrades, renewable energy installations and data center infrastructure all rely heavily on copper for wiring, motors and interconnections.
Even components closely tied to a CPU and high-speed memory subsystems rely on dense copper paths at both the board and facility levels.
Expected demand and supply gap
Analysts from S&P Global have estimated that global demand could reach 42 million tonnes by 2040, representing an increase of around 50% over current consumption levels.
Production is expected to peak much earlier, with S&P Global expecting peak output of around 33 million tonnes around 2030 – implying a potential shortfall of close to 10 million tonnes if current trends remain unchanged.
Primary copper mining is facing declining ore grades, rising costs and increasingly complex extraction.
Bringing new mines into operation also involves long time scales, on average 17 years. These delays limit how quickly supply can respond to rising demand, even when prices signal scarcity.
Another recent report by PricewaterhouseCoopers suggested that lime changes threaten copper mines, which require a constant water supply but often operate in drought-risk areas.
Environmental stress, regulatory hurdles and capital intensity combine to slow the expansion of new generation capacity, and secondary supply from renewable sources cannot close the gap, according to S&P analysis.
Although telecommunications companies switching to fiber optic cables can free up 800,000 tons of copper wires, the contribution remains limited.
Recycling is expected to account for only about a third of total supply in 2040, even under optimistic collection assumptions.
China has between 40 and 50% of global copper smelting and refining capacity, creating vulnerabilities linked 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 that this concentration increases exposure to geopolitical shocks and wider supply disruptions.
Similar concerns have previously surfaced around rare earth minerals and legacy semiconductor manufacturing.
S&P highlights the need to expand processing capacity beyond existing hubs to reduce reliance on a narrow set of regions.
Some technology executives, including Broadcom’s CEO, say silicon photonics, which uses light instead of copper for connections, won’t 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 remains high.
Nvidia-backed photonics startup Ayar Labs is targeting hyperscale customers with GUC design collaboration, but those efforts still depend on physical infrastructure that remains copper-intensive.
Primary production remains the only practical way to close the gap, S&P concludes.
The magnitude of the expected growth in demand suggests that the copper restrictions are likely to continue without faster permitting, broader investment and genuine multilateral cooperation.
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