AI’s future rests on copper, and global supply shortages could hamper big tech infrastructure plans

Copper demand is expected to skyrocket over the next two decades, according to new research from S&P, fueled in part by surging AI industry growth.

Analysis from the consultancy shows demand for copper will soar by 50% across the next 14 years. Demand levels in 2025 stood at 28 million metric tons, S&P noted, and this is expected to grow to 42 million by 2040.

This surging demand poses questions about the ability of global copper producers to meet expectations across the period, with concerns about looming bottlenecks rising.

At present, S&P warned global supplies are falling short by around 10 million metric tons each year.

A key concern highlighted by S&P lies in competition for resources. The AI industry is hungry for materials as data center infrastructure projects expand rapidly – and are expected to continue growing over the next decade.

Recent analysis from JLL projects the global data center market to grow by 14% annually between 2026 and 2030, with nearly 100 GW of new data centers coming online across that period.

This, the firm noted, represents a doubling of global capacity.

Copper is a key material used across an array of industries, with the transportation, construction, telecommunications, and electronics sectors all relying heavily on the resource.

S&P said growth in these respective industries, and thereby growing demand for the material, means the AI industry faces an intense battle to secure vital resources.

“Copper is among the most critical metals of the 21st century, essential for a world that is increasingly electric,” the consultancy said.

“Across the global economy we see major growth in demand for electricity, whether for power hungry data centers enabling AI, the global shift to electric vehicles, the 2 billion air conditioners that will be installed, or the electrified weapons of the future.”

Copper supply warnings growing

The S&P report marks the latest in a string of studies highlighting potential bottlenecks in copper supplies over the next decade or so.

Similar analysis on the state of the global mining industry also warned climate change could disrupt supply chains, again having a knock on effect on data center infrastructure projects.

A study by PwC found nearly one-third (32%) of global semiconductor production will be reliant on copper supplies at high risk of water shortages between 2025 and 2035.

“More and more of the copper supply that semiconductor production relies on is at risk,” the consultancy said.

“As early as 2035, at least 34% of every semiconductor-making territory’s copper supply is projected to be at risk of drought disruption.”

Key markets, such as Chile, were identified as being at “severe drought risk” while 17 other countries are expected to face similar issues. These markets included China, Mexico, Australia, and Brazil.

Glenn Burm, global semiconductors leader at PwC South Korea, described semiconductors as the “hidden lifeblood of modern technology” at the time, warning disruption could have a serious impact on the global technology landscape.

“It’s hard to think of a company that doesn’t rely on semiconductors in some way,” Burm said.

“They underpin economic security, are vital to unlocking the potential of AI and integral to renewable energy.”

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