by Şeref Kılıçlı
The energy transition is expected to increase global copper demand from 25 million tons to 36.6 million tons by 2031. The two most important tools expected to contribute to meeting the supply gap in this process will be new mineral processing technologies and increasing production through recycling.
Rapid growth in clean energy technology investments is driving demand for critical minerals such as lithium, cobalt, nickel and copper. According to the International Energy Agency’s (IEA) Critical Minerals Market Assessment report, supply diversity remains a concern for critical minerals, despite increasing demand and investment. According to the IEA’s published policy scenario, demand for critical minerals is projected to more than double by 2030 and increase 3.5 times by 2050, in line with the projected pace of the clean energy transition. This rapid growth in demand will put critical minerals at the center of the global mining sector.
CLIMATE AGREEMENT
The main goal of the Paris Climate Agreement, which will directly affect the mining sector, is to keep the global temperature increase significantly below 2 degrees Celsius through the emission reduction steps included in the national contribution declarations of the party countries, to limit it to 1.5 degrees if possible, and to have zero greenhouse gas emissions by 2050.
In this process, investments in green energy transformation will play a decisive role in achieving the targets. According to IEA data, the production of an electric vehicle requires 5 times more minerals than a gasoline-powered vehicle, and wind turbines require 8 times more minerals than natural gas-based power plants, and copper stands out among these minerals.
COPPER NEED
Copper is the most widely used metal in energy generation, transmission infrastructure and energy storage, and is the second most widely used metal after aluminum and steel in the construction, telecommunications, transportation and automobile manufacturing sectors. In terms of clean energy systems, its strategic importance increases even more. Since copper is a highly efficient conductor, it is used extensively to generate power from solar, hydro, thermal and wind energy. The majority of clean energy systems contain 12 times more copper than conventional systems. According to World Bank research, more than 3 billion tons of minerals and metals will be needed to produce electric cars and low-carbon electricity to stay below the 2-degree temperature rise limit set by the Climate Agreement. It is also estimated that 550 million tons of copper will be needed for wind turbines, solar panels and electric cars over the next 25 years.
SUPPLY DEFICIT WARNING
While copper is so important in the energy transformation process, studies are also being published warning that the global copper market could face extremely large deficits in the coming period. According to the international consulting firm McKinsey, the global electrification process is expected to increase annual demand for copper from around 25 million tons to 36.6 million tons by 2031. McKinsey also estimates that copper supply will be around 30.1 million tons by the end of 2030, leaving a gap of 6.5 million tons.
WILL CHANGE GEOPOLITICS
S&P Global Market Intelligence predicts that annual global copper demand will almost double to 50 million tons by 2035. Stating that the energy transition will be much more dependent on copper than the current energy system, S&P Global Vice President Daniel Yergin said, “A new geopolitical order will emerge around minerals like copper. For example, an electric car uses 2.5 times more copper than a car with an internal combustion engine. So more copper needs to be mined. To meet the Paris Agreement 2050 targets, copper supply needs to double by the mid-2030s. But the current growth in supply is nowhere near this pace,” analyzes the report. On the other hand, opening a new mining site is also an important process, and according to the International Energy Agency, it takes an average of 16 years for a new copper mine to become operational.
SOLUTION PROPOSALS
The International Energy Forum’s (IEF) Copper Mining and Vehicle Electrification report points out that due to current copper mining regulations, it may not be possible to open new mining sites for the transition to fully electric vehicles by 2035.
Stating that copper mining conditions need to improve to meet this challenge, Juan Ignacio Diaz, President of the International Copper Association (ICA), said: “There are enough copper reserves in the earth and underground to meet sharply rising global demand, including from electric vehicles. Meeting this challenge requires a better understanding of responsible mining, new investments, more efficient permitting processes, the introduction of new mineral processing technologies, more copper recycling and increased circularity in copper-dependent systems.”
APPROXIMATELY 30 PERCENT OF DEMAND IS MET BY RECYCLING
Juan Ignacio Diaz, President of the International Copper Association (ICA), emphasized that primary and secondary production methods will need to be used together to meet copper demand in the future: “Today, about 30 percent of copper demand is met from recycled materials. Copper is a unique metal in that it is completely recyclable without losing any of its properties. Copper statistics often focus on consumption. But this is not the right approach.
Copper is used, not consumed. It can even be used again and again. About two-thirds of the copper produced since 1900 is still in productive use today.”
40 PERCENT OF PRODUCTION IN LATIN AMERICA
The top 10 countries in world copper production are Chile, Peru, Congo, China, China, the USA, Russia, Australia, Indonesia, Zambia and Mexico. According to the International Copper Study Group (ICSG) data, a total of 22.40 million tons of copper ore was produced globally in 2023. This amount is expected to increase to 22.51 million tons in 2024 and 23.40 million tons in 2025. On a regional basis, Latin American countries ranked first in copper ore production with approximately 8.86 million tons in 2023. In other words, about 40 percent of global copper mine production was realized in Latin American countries.
Source: https://istanbulticaretgazetesi.com/tr/bakirda-arz-acigina-geri-donusumlu-care?s=08
