Copper Demand Surge Linked to AI and Data Centers by 2030

Copper demand could skyrocket by one million metric tons by 2030 due to the rise in artificial intelligence and data centers, according to commodity trader Trafigura. The energy transition towards electric vehicles and renewable energy technologies is expected to drive up copper consumption as the world aims to reduce carbon emissions. Saad Rahim, chief economist at Trafigura, highlighted the sudden growth in demand from data centers and AI, which could exacerbate supply deficits. This additional demand is on top of the existing four to five million ton deficit projected by 2030. Global copper demand is currently around 26 million tons, with expectations of a market deficit exceeding 100,000 tons by 2025. China's dominance in copper production and supply of critical raw materials for the energy transition raises concerns for Western countries striving for net zero targets. Beata Javorcik from the European Bank for Reconstruction and Development warned that geopolitical tensions could hinder the green transition, as China controls a significant share of critical raw material production. Rare earths and graphite essential for electric vehicle batteries are among the materials dominated by China. The looming surge in copper demand poses challenges for the global supply chain and highlights the need for strategic resource management in the face of evolving technological demands.