In the meantime, the megatrend “sustainability” has become an integral part of our society. In fact, it has come to stay. The United Nations established this trend with the announcement of the 17 “Sustainable Development Goals” (SDG) in 2015. The outlined goals forced the implementation of national strategies, which are reflected in our present and future laws and market requirements. Examples of the increasing legal and regulatory requirements for companies in Germany are the EU Conflict Minerals Regulation, the Supply Chain Act (German: Lieferkettensorgfaltspflichtengesetz (LkSG)) or the Corporate Sustainability Reporting Directive (CSRD). It’s a fact – the course for sustainability has been set and will shape our society as well as the economy.

Although the increase in regulatory requirements and new market conditions are very challenging for the copper business, these changes offer great opportunities, especially due to the upcoming decarbonization of the energy sector. Either electric vehicles or wind turbines: the energy transition will require high volumes of the industrial metal. The primary target is to achieve CO₂ neutrality by 2050. The way to CO₂ neutrality thereby pays entirely to SDG 13 “Climate change mitigation and adaptation”. Even though copper is essential to achieve CO₂ neutrality, it shouldn’t be forgotten that the electrolysis process in copper production is very CO₂ intensive. This leads to a kind of conflicting targets. In order to resolve this conflict as best as possible, many cathode manufacturers have committed themselves to sustainability. The CO₂ emissions per ton of copper, the so-called “Product Carbon Footprint” (PCF), is included in the sustainability reports of numerous copper producers already. While the global average CO₂ footprint for one ton of copper is 4 tons CO₂ equivalent (CO₂e), the sustainability report of Germany’s largest copper smelter Aurubis shows a PCF of 1.46 tons CO₂e per ton of copper cathodes. According to the report, this figure has decreased by 36% since 2013. The german company aims to achieve climate neutrality before 2050.

Effective methods to further reduce these figures are the use of green electricity and the use of recycled materials. Copper can be recycled any number of times, that turns the recycling process into the ultimate tool for improving the CO₂ footprint. In this way, producers are able to optimize the energy-intensive process from mining to the electrolysis process. A good example is the PCF of the cathode production at Montanwerke Brixlegg. The Austrian recycling company uses recycled copper to produce cathodes and achieves an exceptionally low PCF of 0.739 tons of CO₂e per ton of copper cathodes. In Germany half of the demand is currently covered by recycled material. However, given the threat of supply problems for the upcoming energy transition, the capacity of recycled copper is far away from being enough to cover the total demand.

With all these efforts, there is no way around copper, because copper is found everywhere where electricity is transmitted. Accordingly, the demand will be great in the future to further advance and expand the megatrends of decarbonisation, e-mobility and digitalisation.

According to a market analysis by the financial services provider S&P Global, the expansion could be delayed due to the limited availability of the industrial metal. Solar power plants require twice as much, offshore wind power plants up to five times as much copper per megawatt hour as classic power plants.

“The energy transition will be much more dependent on copper than our current energy system,” Daniel Yergin, vice chairman of S&P Global, told US broadcaster CNBC.

In its report, S&P Global forecasts that annual global copper demand will almost double to 50 million tonnes by 2035 and that this demand will even reach more than 53 million tonnes by 2050.

Cumulatively, the copper consumption of the next 28 years would exceed the total copper consumption of the last 120 years. With the conversion from fossil to renewable energy sources, the required quantities multiply very quickly.

Last year, the investment bank Goldman Sachs even ushered a new era in its study, calling copper the new oil – “no decarbonisation without copper”. Goldman Sachs expects that the demand for wind turbines alone will account for 20% of the copper demand from renewable energies. Electromobility will require up to 40%, mainly for charging infrastructure and motors.

The Berenberg bank takes a similar view and even spoke of a super-cycle for industrial metals in the coming decades, triggered by decarbonisation.

The recent price slide of 35% is therefore likely to be only a snapshot, as the fundamental demand drivers will remain in place in the future.

If the demand for copper is set to double by 2035, what about the supply?