• Copper demand is projected to rise 50% by 2040, driven by AI, EVs, and energy transition infrastructure.
• Without major supply expansion, a 10M metric ton shortfall could disrupt global electrification projects.
• Data centers, defense systems, and emerging AI applications are creating new, rapidly growing copper consumption vectors.

Copper

Copper’s role in powering the global economy is entering a critical phase. Decades after electrifying cities, the metal remains essential for modern infrastructure, digital technology, and industrial systems. Today, copper underpins everything from electric vehicles (EVs) and renewable energy to AI-powered data centers.

Global demand is on a steep upward trajectory. S&P Global forecasts that copper consumption will grow from 28 million metric tons in 2025 to 42 million metric tons by 2040. Moreover, meeting this demand faces serious obstacles: aging mines, limited new projects, and the need for expanded refining capacity. Without major interventions, the world could see a 10 million metric ton shortfall by 2040.

The rise of AI adds a new dimension to copper demand. Data centers, essential for running AI systems, are electricity-intensive and heavily reliant on copper for power delivery, cooling, and IT infrastructure. By 2030, data centers alone could account for 14% of US electricity consumption, up from 5% today. Moreover, AI’s growth amplifies indirect demand as industrial, commercial, and personal applications expand globally.

Supply Pressures

Other demand drivers remain substantial. Core economic use, from construction, electronics, and appliances, continues to grow, especially in developing regions where rising incomes and urbanization are increasing electricity consumption. EVs require nearly three times more copper than traditional vehicles, while renewable energy projects and battery storage are further expanding demand. Defense spending, including modernized military systems and communications infrastructure, is another inelastic driver projected to triple by 2040.

Supply pressures compound the challenge. Unplanned mine outages, slower project development, and geographic concentration of resources risk bottlenecks. Thus, expanding supply will require long-term investments and strategic planning to ensure copper can support the accelerating pace of global electrification.

As 2025 came to an end, Copper climbed to nearly USD 12,000 a ton, marking its strongest annual performance in over a decade. This has been fueled by trade disputes, supply disruptions, and growing long-term demand. 

Copper is not just a commodity; it is a critical enabler of technology, energy transition, and industrial growth. Thus, making strategic planning for supply chain exposure and infrastructure investment key in the years ahead.