AI Data Centers Drive Copper Demand, Straining Supply Chains

Copper is a critical conductive material for power grids, transformers, data-center power distribution and cooling systems. It also supports electric vehicles and renewable energy. The International Energy Agency’s 2025 Global Critical Minerals Outlook estimates that copper demand linked to the energy transition will rise from 7.737 million metric tons in 2024 to 12.162 million metric tons in 2040. Long lead times for new mines make the supply-demand mismatch a strategic risk.

Alphabet announced on June 1, 2026, that it would raise $80 billion to expand its AI infrastructure, then increased the amount to $84.75 billion on June 3. S&P Global estimates that hyperscalers’ AI capital spending will exceed $2.5 trillion by 2030. The IEA has warned that without sufficient new mining supply, copper production could fall 30% short of demand in 2035, turning a projected shortage into a supply-chain challenge.