The global copper market is facing a growing supply deficit, driven by surging demand from electrification, grid upgrades, and AI data centers. This shortage threatens to slow the technological boom of the century. Prices reflect the strain, with London copper reaching an all-time high of nearly $14,850 a ton in August and currently trading around $14,470, up about 15% this year. Refined metal has become scarce outside the United States as traders ship physical copper into the U.S. ahead of expected tariffs, depleting inventories in China and other regions.
Forecasters disagree on the size of the supply gap but agree it is coming. Morgan Stanley predicts a market shortfall of about 600,000 tons this year, while J.P. Morgan expects a shortfall of about 330,000 tons. The International Copper Study Group has revised its surplus forecast to a deficit. The long-term outlook is even worse, with BloombergNEF warning of a 20 million metric ton shortfall by 2050 unless miners invest about $332 billion in new supply. Even with this investment, the gap is likely to persist until at least 2043, as new mines take an average of 17 years to develop.
BHP Group Limited’s latest quarterly results highlight the fragility of copper supply. Copper output fell 19% to 400.7 thousand tons in the September quarter, missing estimates. Bad weather and a fatal maintenance accident disrupted operations at the Escondida mine in Chile, while an underground conveyor belt failure affected the Carrapateena mine in South Australia. Chile’s long-term output is expected to decline from 5.8 million tons in 2026 to 4.8 million tons by 2050. Copper has become BHP’s main profit driver, generating $18.19 billion in operating earnings this year, surpassing iron ore.