The world faces a critical copper shortage within a decade that could derail global energy transition efforts and artificial intelligence expansion, the International Energy Agency warned at a United Kingdom summit this week.
Shobhan Dhir, an IEA analyst specializing in critical minerals, told government and industry leaders that copper supply could fall 30% short of demand by 2035 based on current mining project pipelines. The deficit could widen to 40% under aggressive climate action scenarios.
“Copper is the one we’re really concerned about,” Dhir said at the UK Critical Minerals Summit on Sunday. “This is a really challenging mineral to ramp up supply quickly. So we are particularly concerned and I want to highlight that as one of the key global issues going forward.”
The warning comes as copper prices hover near record levels. The metal surged to an all-time high of $11,450 per metric ton on the London Metal Exchange Friday as concerns over tightening supplies pushed prices higher.
The IEA projects global refined copper demand will climb from 27 million metric tons in 2024 to 33 million tons by 2035 and 37 million tons by 2050. Electric vehicles, renewable energy infrastructure, data centers supporting artificial intelligence operations, and power grid modernization projects drive the accelerating requirements.
AI data centers alone could consume between 250,000 and 550,000 metric tons annually by 2030, representing up to 2% of global demand, according to IEA estimates.
Analysts project mining output will reach maximum levels around 2028-2029 at approximately 24 million tons annually, then fall below 19 million tons by 2035. The trajectory reflects multiple structural constraints that distinguish copper from other critical minerals.
Copper ore grades have deteriorated 40% since 1991, substantially increasing capital costs and operational complexity. Exploration efforts have yielded diminishing returns: miners discovered only 14 new copper deposits in the past decade compared with 225 in the previous 23 years.
New mine development timelines average 17 years from discovery to production, according to IEA data. This extended period creates a fundamental mismatch between surging demand and the industry’s capacity to respond.
“Unlike lithium, where new supply is emerging across diverse regions, including Zimbabwe and Argentina, copper faces structural constraints that cannot be easily overcome through rapid capacity additions,” Dhir noted.
Meeting projected demand will require $500 billion to $800 billion in mining sector investment through 2040, IEA analysis shows. Other analysts project even higher requirements: BloombergNEF calculated $2.1 trillion in investment across energy-transition metals by 2050.
Supply concentration presents additional vulnerabilities. China accounts for 45% of refined copper production and will reach 50% by 2040. China dominates refining for 19 of the 20 strategic minerals the IEA tracks across energy, defense, aerospace and artificial intelligence sectors.
“This is exceptional concentration like we have not seen before,” Dhir warned, noting that export controls proliferated sharply in 2025.
Industry consolidation has accelerated in recent years. Top-three refiner market share in major energy minerals rose from 82% to 86% between 2020 and 2024, with the leading producer capturing nearly all the growth.
Without Chinese supply, other nations could satisfy only 50% of their battery metals and rare earth requirements, Dhir noted. This concentration creates significant exposure to trade disputes and climate-related disruptions.
Enhanced recycling will prove essential to meeting future demand, though current recovery rates fall short of technical capabilities. Secondary copper supply accounted for less than 17% of total demand in 2024, down from 18% in 2015.
The UK government unveiled its critical minerals strategy at the summit, targeting 10% of industrial demand through domestic production by 2035 and an additional 20% through recycling. The strategy includes up to £50 million in targeted funding.
“Critical minerals such as rare earths are too precious to be readily disposed of and never seen again, and yet that does happen,” said Sarah-Jane Makepeace, UK director general for energy security and net zero. “By strengthening our own capabilities for recycling, mining and refining in the UK, we can create a much more circular economy.”
London is pushing a rule that no more than 60% of any critical mineral should come from a single supplier, responding directly to China’s dominance of 70% of rare earth mining and 90% of processing.
While diversification efforts show promise, Dhir noted that emerging producers face costs roughly 50% above established operators. Success will demand policy coordination, shared investment risk and new financial instruments.
“Without them, the world risks building its clean-energy and AI revolutions on an increasingly unstable foundation,” he said.
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