STAGE 4 · COPPER AND METALS
Copper: the material of electrification
Key points
- After inflation copper is 2.2x its 2020 low. It was dearer only during the 1970s oil shocks and the 2006–11 China boom.
- The rise is more about supply than demand. A new mine takes 16 years, three big mines had accidents in 2025, and smelters are fighting over ore so hard that their processing fee fell to zero.
- Data centres use only about 1% of copper. It runs short because grids, EVs, air-conditioning and factories all need it at once.
- Fear of US tariffs once made copper in New York 22% dearer than in London (Jul 2025); the gap is now 1.4%.
What copper is used for
- Equipment (motors, transformers, appliances, air-conditioning) 32%
- Buildings (wiring and plumbing) 26%
- Infrastructure (power grids, telecoms) 17%
- Transport (cars etc.) and industrial machinery 25%
Copper carries electricity better than anything except silver, so it is in almost every wire, motor and transformer. Data centres use about 400,000 tonnes a year (BloombergNEF, peaking at 572,000 in 2028), about 1% of world use. The squeeze comes from grids, EVs, air-conditioning and factories together, and above all from slow supply.
Source: ICA via Statista / BNEF 2025
Why supply is slow
A new mine takes over 16 years from discovery to output
It takes 16.5 years on average from discovery to first production (IEA). Higher prices do not bring new supply quickly.
Source: IEA 2021
Ores are getting leaner and costlier
The IEA warns copper could be up to 30% short by 2035, citing falling ore grades, rising costs and few new discoveries.
Source: IEA, May 2025
A run of accidents at big mines in 2025
Kamoa-Kakula in Congo was hit by tremors and flooding in May, El Teniente in Chile suffered a collapse on 31 July (six dead), and a mudslide on 8 September shut Grasberg in Indonesia, the world's second-largest copper mine; Freeport declared force majeure and expects normal output only in 2027.
Source: AG Metal Miner, Oct 2025
Smelting fees fell to zero
The 2026 benchmark treatment and refining charge that smelters earn for processing mine output is $0 a tonne (2025: $21.25). Mine concentrate is so short that smelters are competing for it, a headwind for Japan's smelters (Sumitomo Metal Mining, JX Advanced Metals, Mitsubishi Materials).
Source: MINING.COM, Dec 2025
US tariffs briefly made American copper dearer
From 1 August 2025 the US put a 50% tariff on semi-finished copper (pipes, wire, sheet). Refined copper was left out, but a 15% duty in 2027 and 30% in 2028 has been proposed. Copper was shipped into the US ahead of the tariff, pushing the New York (COMEX) price well above London (LME).
Source: CRS
Copper in its own history
After inflation, copper was dearer only during the 1970s oil-shock years and at the 2006–2011 China peak. Height in its history: 95 out of 100.
Supercycle Check: where copper and 42 commodities stand in 175 years →
Source: World Bank / FRED
New York vs London
Exchange copper stocks are not shown: CME (COMEX) blocks automated downloads, the Shanghai Futures Exchange moved its public files in autumn 2025 and they can no longer be fetched, and LME data is paid.
Source: Yahoo Finance / World Bank / CRS
Aluminium, nickel and uranium
| Metal | Price | vs 2019, real | Height in history (0–100) | Note |
|---|---|---|---|---|
| Aluminium | 3,251 $/t | +39% | 41since 1960 | Can replace copper in power lines and car bodies. Smelting uses huge amounts of electricity, so dear power curbs supply. |
| Nickel | 16,751 $/t | -8% | 29since 1960 | A battery metal. Indonesia's output surge has left it in surplus, so it is cheap despite electrification. |
| Uranium | 69 $/lb | +105% | 81since 1992 | Nuclear fuel; restarts and licence extensions support demand. Price: IMF monthly, dollars a pound. |
| Gold (for comparison) | 4,411 $/troy oz | +142% | 99since 1960 | Unrelated to electrification, but shown to check the view that gold's rally will spread to copper (see the Expert views page). |
Source: World Bank / FRED
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Updated 29 Sep 2026 11:12 JST · US power data to May 2026 · metal prices to Aug 2026