A warning has been issued that copper supply could fall short by millions of tonnes within years as global electrification expands and demand for industrial infrastructure rises.

On Jan. 14 local time, IT outlet TechRadar reported that S&P Global analysts said copper demand is rising rapidly for electric vehicles, power grid upgrades, renewable energy installations and data centre infrastructure. They forecast global copper demand will reach about 42 million tonnes in 2040. That would be about 50 percent above current consumption. Copper output, by contrast, is expected to peak at about 33 million tonnes around 2030, raising the possibility of a shortfall of about 10 million tonnes.

Experts cited declining ore grades, rising mining costs and complex mining conditions as key causes of the supply shortfall. New mines take an average of 17 years to begin operations, and output growth is limited by climate change and water scarcity risks, environmental regulations and the capital-intensive nature of projects. Recycled copper supply is also expected to account for about one-third of total supply by 2040, making it difficult to make up the gap.

China accounts for 40 to 50 percent of global copper smelting and refining capacity, increasing risks tied to regional concentration. Electricity-based industries such as power grids, data centres and GPUs depend heavily on copper, leaving them vulnerable to geopolitical shocks or supply chain disruptions. S&P Global stressed the need to expand smelting capacity outside existing hubs to reduce dependence on specific countries.

Technology companies also noted that alternatives such as photonic technology or silicon photonics are unlikely to see broad use for the time being. Key equipment such as GPUs, servers and power grid hardware still relies on copper, and demand is expected to remain high. Experts warned that constraints on copper supply could become prolonged without faster permitting, increased investment and multilateral cooperation.

PricewaterhouseCoopers (PwC) said climate change could directly affect copper mine operations. Copper mining requires a stable water supply, but most mines are located in drought-risk areas, meaning environmental stress could constrain output. Analysts also said that even if some copper is recovered through the telecommunications industry's shift to optical fibre, it is unlikely to have a major impact relative to total demand.

In the end, the copper shortage cannot be resolved simply through mine development, with multiple factors such as the environment, regulations, geographic concentration and lack of investment acting in combination. Experts recommended securing the stability of the global copper supply chain through long-term investment, faster permitting processes and multilateral cooperation.