Data centres will need a million tons of copper by 2030

Trafigura, a commodity trader, highlighted that copper demand tied to artificial intelligence and data centres could increase by up to one million metric tons by 2030, potentially exacerbating supply deficits towards the decade’s end.

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The ongoing energy transition, encompassing electric vehicles and renewable energy technologies, is anticipated to drive a significant uptick in copper consumption as global efforts intensify to reduce carbon emissions.

Saad Rahim, Trafigura’s chief economist, emphasized at the Financial Times Global Commodities Summit in Lausanne that the burgeoning demand from data centres and AI has surged unexpectedly. He noted that this additional demand of one million tons would compound the existing forecasted deficit of four to five million tons by 2030, which has not been adequately factored into supply and demand projections.

However, Rahim did not specify the exact global copper demand projection for 2030.

Current global copper demand stands at approximately 26 million tons, with a Reuters survey in January projecting a market deficit exceeding 100,000 tons in 2025, compared to a shortage of 35,000 tons this year.

China, the world’s largest producer and consumer of copper, holds significant influence over global supplies of various industrial metals crucial for the energy transition, raising concerns among Western leaders striving to achieve net zero goals.

Beata Javorcik, chief economist at the European Bank for Reconstruction and Development, expressed apprehension about geopolitical tensions impeding the green transition, highlighting China’s dominance in the production of critical raw materials essential for electric vehicle batteries, such as rare earths and graphite, which are mainly controlled by China.