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Copper has shaped human history and civilisation for millennia. In the 20th century, the story of copper was inextricably linked to the rise of electricity demand. As we harnessed electrical power, copper became an indispensable material, crucial to our energy systems and modern technology.

Through the 21st century, we expect copper to remain an essential building block to modern life as the world seeks to improve living standards for billions of people, transitions towards a net zero greenhouse gas (GHG) emissions economy, and further digitalises its industries and societies.

In this article, we discuss:

Why we believe global copper demand will grow by around 70% to over 50 million tonnes (Mt) a year by 2050 and our view on how copper’s role in multiple applications will provide demand resilience.
The looming global copper supply challenge as existing copper mines age, with the pipeline of potential projects less healthy than in previous cycles. Both brownfield and greenfield projects are expected to face cost and stakeholder challenges.
Why ‘long-run marginal cost’-based inducement is still our preferred approach to forecasting price in the long run.
Demand
Total global copper demand has grown at a 3.1% compound annual growth rate (CAGR) over the last 75 years – but this growth rate has been slowing. It was only 1.9% over the 15 years to 2021. Looking to 2035, however, we expect this growth rate to jump back to 2.6% annually.

We believe this reversal will come from a combination of three key themes: ‘Traditional’ economic growth, and the newer themes of the ‘Energy Transition’ and ‘Digital’ (primarily data centres).

‘Traditional’ demand refers to the basic relationship between economic growth, electricity consumption and copper. Through the 20th century and into the 21st, as countries developed, electricity became accessible to industry and homes and led to the creation of products that lifted living standards: lighting, washing machines, refrigerators, air conditioners, radio and television, computers and smartphones. It is not only these products that need copper; so do the factories and supply chains that produce and deliver them, and the power infrastructure keeping them all running. Copper’s broad application across multiple end-uses has made it resilient and less-exposed to single point failures of demand.

Traditional demand in the developed world is expected to remain strong and as living standards rise globally, the demand for copper is expected to follow suit. Developing economies, which have nearly five times the population of high-income economies, will increasingly strive to achieve the same high standard of living. This transition will lead to a greater need for copper.

Take China for example, despite its enormous appetite for copper over the past two decades, it still only has half of the copper accumulated stock-in-use per capita (e.g. buildings, machinery, vehicles) compared to a developed economy, at around 100 kilograms per capita. India, the other major economy with over one billion people, also has a compelling copper story. India’s electricity consumption per capita currently stands at around one-seventh of Japan’s and one-fifth of China’s, and we expect its copper demand to grow five-fold over its pre-Covid volumes in the coming decades as electricity is made more accessible.

This traditional demand provides a solid foundation, but it does not account for the rapid acceleration of growth expected in the decades to come. That will be driven by the ‘Energy Transition’ and ‘Digital’ trends.

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https://www.bhp.com/news/bhp-insights/2024/09/how-copper-will-shape-our-future