Copper demand set to surge 24% by 2035 as four key disruptors reshape global markets

Core Insights - Global copper demand is projected to increase by 24% by 2035, reaching 42.7 million tonnes per annum (Mtpa), driven by economic development and new demands from electrification and digitalisation [1][2] - Four disruptors could add an additional 3 Mtpa, or 40% of total copper demand growth, by 2035, leading to increased price volatility [2] Disruptors of Copper Demand - Data centres are identified as a significant variable in copper demand forecasting, with AI expected to consume an additional 2,200 TWh of electricity by 2035, raising copper demand for grid infrastructure to 1.1 Mtpa by 2030 [6][9] - The inelastic demand created by data centres means that developers are less sensitive to copper price fluctuations, potentially leading to price spikes of 15% or more during construction surges [7][8] - The energy transition is reshaping copper consumption, with an additional 2 Mtpa of copper needed over the next decade due to the shift to renewable energy systems, and demand from this sector projected to grow from 1.7 Mtpa to 4.3 Mtpa by 2035 [9][10] Regional Demand Growth - India and Southeast Asia are expected to contribute an additional 3.3 Mtpa of copper demand by 2035, with average annual growth rates of 7.8% and 8.2% respectively, driven by rapid industrialisation [10] - If these regions replicate even half of China's historical growth, their construction and power sectors could require an additional 5.4 Mtpa of copper [10] Geopolitical Factors - Increased defence spending in Europe, driven by geopolitical tensions, is expected to add modest direct copper demand of 25 to 40 ktpa over the next decade, but will have broader implications for infrastructure resilience and modernisation [11][12] Supply Challenges - To meet the projected demand growth, more than 8 Mtpa of new mine capacity and 3.5 Mtpa of additional scrap will be required by 2035, with the industry needing to adjust its annual mine disruption assumptions from 5% to 6% [13][14] - The convergence of the four disruptors in a supply-constrained environment could lead to prolonged high prices and unpredictable market fluctuations [14][15]