Global mining giant BHP released a report on Monday (30 September) stating that the energy transition is expected to increase copper demand by one million tonnes (mt) per year until 2035.
The energy transition has seen an influx of copper-intensive technologies deployed, leading to the global production rate of copper doubling.
In the report entitled ‘BHP Insights: how copper will shape our future’, BHP stated that global copper demand registered a 3.1% compound annual growth rate (CAGR) over the past 75 years. This growth rate slowed to 1.9% in the 15 years leading up to 2021, but BHP expects the CAGR to increase to 2.6% in the period to 2035.
In 2023, global copper demand hit 31mt, comprising 25mt of copper cathode and 6mt of scrap.
Rag Udd, chief commercial officer at BHP, explained that as the company looks to 2050 it expects copper demand to grow by 70% to reach 50mt of copper annually.
According to BHP, the energy transition will represent 23% of global copper demand by 2050, an increase from 7% today. The digital sector is expected to increase its global demand share for copper from 1% to 6% by the same year.
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By GlobalData
Electric vehicles (EVs) remain the main copper-intensive technology in the energy transition. EVs are expected to increase the transport sector’s share of copper demand from 11% in 2021 to 20% by 2040, the report notes.
BHP expects the copper industry to face significant challenges to supply with such drastic increases in demand. Rising costs of production and declining ore grades, which BHP estimates have fallen by 40% since 1991, are two key issues impacting copper supply.
The company anticipates an investment of $250bn will be required to address the gap between copper supply and demand by 2050.
According to Mining Technology’s parent company, GlobalData, global copper production is expected to reach 22.9mt in 2024, up by 3.2% over 2023.
