The rapid increase in data centre capacity to meet AI (Artificial Intelligence) demand risks further tightening the global copper market according to new data from BloombergNEF (BNEF). Their research finds that the supply shortfall could reach as much as 6 million tonnes by 2035, given that the projected global supply of copper will reach 29 million tonnes in 2035, well short of an expected demand of 35 million tonnes[i].
The analysts singled out AI data centres as a major driver for copper demand, with this set to average around 400,000 metric tons a year over the next decade, peaking at 572,000 tons in 2028, cumulatively copper used in data centres will exceed 4.3 million tonnes over the course of the next decade. Further, this will be on top of surging demand from other sectors, such as power transmission and wind energy, where copper usage is expected to almost double by 2035[ii].
These changes won’t come cheap, with copper expected to account for as much as 6% of the capital expenditure of an average data centre project. A single large-scale data centre uses considerable resources, for example Microsoft’s $500 million data centre in Chicago required 2,177 tonnes of copper for its construction.
“AI capacity additions are adding pressure to an already tight market,” BNEF analysts said. “While use of the metal in sectors like power transmission and wind energy is set to almost double by 2035, supply is expanding more slowly.”[iii]
BloombergNEF forecasts that copper prices will likely peak at $13,500 by 2028. At present copper prices have experienced a dip, despite demand being up 3.3% in the first quarter of 2025. This is largely due to US tariffs, with prices falling by 20% at the end of July. JP Morgan expects that the combination of tariff-induced market adjustments and the unwinding of inventory build-up will continue to exert downward pressure on prices. “LME copper prices are projected to slide toward $9,100/metric tonne (mt) in the third quarter of 2025 before stabilizing around $9,350/mt in the fourth quarter”[iv].
Data centres are notoriously resource-hungry, and in previous insights we outlined some of the major demands including energy and water.
In April, the IEA revealed that growth in the use of Artificial Intelligence will lead to the global electricity demand from data centres more than doubling in the next 5 years, reaching 945 terawatt-hours (TWh) in 2030. Notably this figure is equivalent to Japan’s current annual electricity usage and represents an almost 128% increase from the 415 TWh of power used by data centres in 2024[v].
"AI will be the most significant driver of this increase, with electricity demand from AI-optimised data centres projected to more than quadruple by 2030,"[vi] the IEA has claimed. The researchers credit a step change in the capabilities of artificial intelligence (AI) with soaring demand, explaining that this has been driven by falling computation costs, a surge in data availability, and technical breakthroughs.
And, in September last year, ZCA discussed how Big Tech is under pressure to address concerns over water stewardship, given soaring AI demand is leaving data centres ‘thirsty’[vii]. With many data centres using fresh water to keep servers and equipment cool, there is growing stress being placed on water courses and supply networks particularly as most centres source their water in the form of potable (drinkable) water from utility companies.
Worryingly, the rise of AI is increasing demand, placing even greater stress on water supplies. The research paper “Making AI Less ‘Thirsty’: Uncovering and Addressing the Secret Water Footprint of AI Models” released in October 2023, found that globally, AI has the potential to account for between 4.2 billion - 6.6 billion cubic meters of water withdrawal by 2027. This is equivalent to half the annual withdrawal in the United Kingdom each year[viii].
The scale of water use in data centres is already considerable, in 2022 Google’s self-owned data centres withdrew 25 billion litres of water, consuming almost 20 billion of this for on-site cooling, with both of these figures representing an increase of almost 20% compared to 2021[ix]. Additionally, Microsoft’s total water usage saw a 34% increase for the same period signifying a potential link to the growing demand for AI.
[i] Data Center Demand to Exacerbate Copper Shortage, BNEF Says - Bloomberg
[ii] Ibid
[iii] Ibid
[iv] Cautious on Copper: Market Outlook | J.P. Morgan Global Research
[v] Data centre energy requirements to double in the next 5 years, as AI demands soar
[vi] Executive summary – Energy and AI – Analysis - IEA
[viii] 2304.03271 (arxiv.org)
[ix] Ibid
Lauren has extensive experience as an analyst and market researcher in the digital technology and travel sectors. She has a background in researching and forecasting emerging technologies, with a particular passion for the Videogames and eSports industries. She joined the Critical Information Group as Head of Reports and Market Research at GRC World Forums, and leads the content and data research team at the Zero Carbon Academy. “What drew me to the academy is the opportunity to add content and commentary around sustainability across a wealth of industries and sectors.”
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