Copper demand linked to data centers and artificial intelligence (AI) could add around 200,000 metric tons per year by 2030, according to a note from Australian financial group Macquarie. This estimate is significantly lower than some other market estimates, which have ranged from 500,000 tons to over 2 million tons per year by 2030.
Macquarie’s analysts believe the actual impact will be considerably lower than these more optimistic projections. They estimate that 95,000 tons of copper a year would be needed for construction of power capacity related to the data centers, while the increase in demand for the data centers themselves would range from 60,000 to 140,000 tons of copper per year by 2030.
The increased copper demand from data centers and AI comes on top of the already accelerating demand for the metal driven by the production of electric vehicles, solar panels, and grid investment, particularly in China, the world’s top consumer of copper.
This growing demand, combined with tight supplies of copper concentrate, has propelled copper prices on the London Metal Exchange to the highest level in more than two years, reaching $10,350 a ton.
However, the global copper market is expected to face a surplus of 162,000 tons this year and 94,000 tons in 2025, according to the International Copper Study Group (ICSG). This suggests that the copper market may not be as tight as some have feared, potentially tempering the impact of the new demand from data centers and AI.