Australian miner BHP expects the world to consume an extra 1 million metric tons of copper per year on average until 2035 due to the adoption of copper-intensive technologies, double the annual volume growth in the past 15 years, reports Reuters.
Copper has long been used in the construction, transport and power sectors due to its durability, malleability and conductivity. In recent years, it is also used in making electric vehicles, green energy plants, and data centres.
BHP said in a report released on Monday that global copper demand has grown at a 3.1 per cent compound annual growth rate over the last 75 years. But this growth rate has been slowing to only 1.9 per cent over the 15 years to 2021, it said.
"Looking to 2035, however, we expect this growth rate to jump back to 2.6 per cent annually," the report said.
Total copper demand in 2023 was 31 million tons, including 25 million tons of copper cathode and 6 million tons of copper scrap, according to BHP, which operates and owns most of the world's largest copper mine Escondida.
"As we look towards 2050, we see a 70 per cent surge in global copper demand to 50 million tonnes annually, driven by copper's role in existing and emerging technologies, and in the world's decarbonisation aspirations," said BHP Chief Commercial Officer Rag Udd.
The mining giant expects the energy transition sector will account for 23 per cent of copper demand by 2050, from 7 per cent currently, it said in the report.
The digital sector, which spans data centres, 5G, artificial intelligence, internet of things and blockchain, will account for 6 per cent of copper demand by 2050, from 1 per cent now, BHP forecast.
China's demand will continue to grow, albeit at a lower rate, because its copper usage per capita is only half that of developed countries. India will also see growth, it said.
Meanwhile, copper mining output growth is constrained by high costs and depleting ore grade.
"We estimate the average grade of copper mines has declined by around 40 per cent since 1991... We expect between one-third and one-half of global copper supply to face grade decline and ageing challenges over the next decade," BHP added.
