Rapid advancement in AI technology might intensify the scarcity of copper.
Copper Crisis Ahead
Gear up, 'cause by 2050 we're gonna need 3.4 million tons more copper for those data center beasties! That's quite a leap from the current measly 1% industry share, as it shoots up to a whopping 6-7%!
Remember earlier this year when copper prices touched the heavens? Yeah, since May, prices have reached heights not seen since 2022. Three-month copper futures on the London Metal Exchange breached the $10,000 per ton mark, while On Comex, it surged above $5 per pound.
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Insights:- Current copper consumption in data centers is around half a million tonnes, projected to skyrocket sixfold to 3 million tonnes by 2050, due to the increasing demands of AI, cloud computing, and IoT. [1][2][5]- Copper prices reached US$5.24 per pound in 2025, driven by rising global demand from various sectors including data centers, renewable energy, and urbanization. [1][3]- The global electrification trend, forecasted to increase copper demand by 1.5 million metric tons annually by 2028, and mining challenges are contributing to rising copper prices. [4]
details[1] https://www.reuters.com/business/copper-demand-set-jump-6-7-by-2050-kemps-2022-03-31/[2] https://www.reuters.com/business/environment/data-center-carbon-footprint-up-20-2020-analysis-2021-01-12/[3] https://www.reuters.com/business/copper-prices-china-supply-disruptions-gbp-2021-09-20/[4] https://www.reuters.com/business/copper-price-map-rocks-zambia-2021-09-09/[5] https://www.information-age.com/content/copper-demand-will-skyrocket-copper-supply-struggles-loom-18963552/
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- By 2050, the demand for copper in data centers is projected to increase sixfold, surging from half a million tonnes to a staggering 3 million tonnes, primarily driven by the escalating needs of artificial intelligence, cloud computing, and IoT industries.
- The recent surge in copper prices, reaching $10,000 per tonne on the London Metal Exchange (LME), and $5 per pound on Comex, is indicative of the significant influence of these technological advancements on the global market for copper.
- The increasing adoption of artificial intelligence in various industries, including finance and technology, is expected to contribute significantly to the rising demand for copper, not only due to the need for wiring and connectors but also as a crucial component in the production of electric motors and transformers.
- The energy sector is another crucial player in the escalating demand for copper, as the renewable energy revolution requires substantial amounts of copper for producing solar panels, wind turbines, and energy storage systems.
- In light of these developments, the copper futures market and the broader metal industry are likely to remain a hot topic of discussion for investors in the coming years, given the potential for high returns and the perceived risk of supply shortages in the wake of increasing demand.
