The global demand for copper is expected to keep growing, as countries ramp up their renewable energy capacity and electric vehicle (EV) uptake increases. Most copper is mined in Latin America and the Democratic Republic of Congo, with China being the dominant miner and refiner. While the United States produces high levels of copper, it also relies heavily on imports to meet its growing demand.
Copper – a Global Overview
The energy transition sector could account for as much as 23% of copper demand by 2050, compared to 7% at present, while the digital sector, including data centers, is expected to contribute around 6%, from 1% today. Transportation’s share of copper demand is expected to rise to 20% in 2040, from 11% in 2021, mainly owing to EV uptake.
“As we look towards 2050, we foresee global copper demand increasing by 70% to reach 50 million metric tons annually. This will be driven by copper’s role in both current and emerging technologies, as well as the world’s decarbonization goals,” said Rag Udd, the chief commercial officer of Australian mining major BHP.
Meanwhile, the average copper mine grade has fallen by around 40% since 1991, and over the next decade, one-third to one-half of the world’s copper supply could face grade decline and aging challenges. Demand for copper is expected to outstrip supply within the next decade unless something is done to change this.
This means that greater investment must be made in copper mining to expand activities in order to meet the rising global demand. BHP estimates that around $250 billion in financing will be required to close the supply and demand gap. Fatih Birol, the executive director of the IEA, also suggested that developed countries should refine more copper, as well as establish partnerships with developing countries to do so.
Where Does the U.S. Get Its Copper?
The U.S. domestically produces more than half the refined copper it consumes each year, with over two-thirds of it being mined in Arizona. It also imports around one million metric tons of copper a year. Chile, Canada, and Peru contributed over 90% of U.S. copper imports in 2024.
China is responsible for the lion’s share of global copper refining, although it mines most of its copper ore elsewhere, primarily in Latin America. Chile and Peru together contribute around a third of global copper production. However, China is mining more copper year on year, having invested heavily in the development of mines in the Democratic Republic of Congo, which is the world’s second-largest copper miner, having overtaken Peru.
Copper Costs More in the U.S. than Elsewhere
At the beginning of July, President Donald Trump said he planned to impose a 50% tariff on copper imports, which has sent the price of the metal sky-high. Copper prices had already risen in recent months, and now U.S. copper prices are higher than anywhere else in the world, which is expected to have a knock-on effect on the economy.
The U.S. requires copper for products such as machinery, electronics, household goods, housing, and infrastructure projects, as well as to support renewable energy and the EV industry. Although Trump has stated plans to ramp up domestic production, that could take several years and a significant financial investment, during which time the U.S. will face higher copper import prices.
It is still uncertain when tariffs may be introduced on copper and how high they may be. The U.S. Commerce Secretary Howard Lutnick said the duties would likely be implemented at “the end of July, maybe August 1.”
The London-based agency Benchmark Mineral Intelligence expects that U.S. consumers could be paying as much as $15,000 per metric ton for copper by August if the tariffs come into place, compared to around $10,000 in the rest of the world. Since Trump announced the first new U.S. tariffs on various imports in February, traders have been moving inventories away from Europe and Asia and into the U.S.
Benchmark’s lead analyst for copper demand and prices, Daan de Jonge, explained the impact this price rise may have on the U.S. economy. “On household spending, if you’re buying a new fridge, air conditioner, car, everything is going to get more expensive, and companies could reasonably be expected to pass that on,” he said. This could encourage U.S. consumers to buy products that are more cheaply produced abroad.
De Jonge said the tariffs could spur higher infrastructure costs and potentially job losses. He speculates that the rising cost of copper could lead consumers to swap copper for cheaper aluminum, which is heavier and more costly to maintain.
It is not yet clear when the copper tariff may come into place, and if Trump will follow through with his planned 50% duty. However, many industries are preparing for a price increase, which could lead to them using alternative metals or shifting the cost to the consumer. Meanwhile, increasing domestic production to the level needed to replace copper imports to the U.S. will likely take several years and a significant financial investment.
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