The world's biggest copper producer, BHP, expects the copper market to move into a structural deficit from around 2028. Its finance chief says 8-10 million tonnes of new supply, the output of eight to ten Escondida mines, will be needed by the mid-2030s.
At a glance
- BHP's outlook has copper demand rising from about 34 million tonnes in 2026 to over 50 million tonnes a year by 2050.
- Data centres alone could need around 3 million tonnes of copper a year by 2050.
- Copper made up more than half of BHP's underlying EBITDA for the first time in its 2025-26 financial year.
Background
A structural deficit means demand runs ahead of supply for years, not just for a few months. Escondida in Chile is the world's largest copper mine and one of BHP's main assets. Copper demand is rising with power grids, electric vehicles and data centres, while ageing mines produce less as their ore is depleted.
What BHP said
The copper market is likely to move into a structural deficit from around 2028, BHP chief financial officer Vandita Pant said, Argus reported. Pant was speaking at the FT Metals and Mining Summit in London on October 15. Another 8 million to 10 million tonnes of supply will be needed by the middle of the next decade, equal to eight to ten mines the size of Escondida.
Supply is the problem as much as demand. Depletion at existing mines means new projects are needed even before demand growth is counted, Pant said.
Where the demand comes from
Traditional drivers such as urbanisation and population growth are now joined by digitalisation, AI, power grids and the energy transition. BHP's latest outlook has global copper demand rising from around 34 million tonnes in 2026 to more than 50 million tonnes a year by 2050. Data-centre demand alone could reach around 3 million tonnes a year by then.
Pant also described "tactical" deficits that can appear before the structural one arrives. These happen when miners produce less than they promised. "There are tactical deficits because I think we have all guided to some states and produced something else," Pant said.
How it fits the wider picture
Forecasters differ on the near term. The International Copper Study Group this week cut its 2026 mine production growth forecast to 1.3% from 1.6%, but expects mine growth to accelerate to 3.1% in 2027.
BHP is betting on the long term. It expects its organic projects to lift attributable copper production to around 2 million tonnes by its 2035 financial year. Growth options include expansions at Escondida and Copper South Australia, the Vicuña joint venture in Argentina and the Resolution project in the US.
Our read
Outlook: bullish. The world's largest copper miner expects a lasting shortfall within two years, which supports a positive long-term outlook. Near-term forecasts still show surpluses.
What to watch
- Whether other major miners and forecasters move their deficit timelines closer to 2028.
- Progress at BHP's Escondida, Copper South Australia and Vicuña growth projects.
- Mine output against guidance, which drives the tactical shortfalls Pant described.
For information only, not investment advice.
Copper price in India
metalscost.com India reference price as of 2026-11-07.
Detailed analysis
Timeline
- 2026-10-15: BHP CFO Vandita Pant forecasts a structural copper deficit from around 2028.
Demand Drivers
Grids, the energy transition, digitalisation and AI are adding to traditional copper demand.
Supply Drivers
Depletion at existing mines means new projects are needed just to hold output steady.
Mining Production
The ICSG cut its 2026 mine growth forecast to 1.3%, but sees 3.1% growth in 2027.
What could lift prices
- BHP sees a structural shortfall starting within two years.
- Data centres could need about 3 million tonnes of copper a year by 2050.
What could weigh on prices
- The ICSG expects mine output growth to speed up to 3.1% in 2027.
- Expectations around AI demand could shift short-term consumption, Pant said.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Chile | Medium | Escondida, the benchmark for BHP's supply gap, and much of its copper growth are there. |
| Australia | Low | BHP plans to expand its Copper South Australia operations. |
| Argentina | Low | The Vicuña joint venture is one of BHP's copper growth options. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Copper Mining | Positive | A long-term shortfall supports investment in new copper mines. |
Who gains, who loses
- BHP: Copper already provides over half of its underlying EBITDA.
- Copper-intensive manufacturers: A structural deficit would mean higher and more volatile input costs.
Other ways this could play out
- If mine output keeps missing guidance, shortfalls could arrive before 2028.
- If 2027 mine growth reaches the ICSG's 3.1%, the deficit could take longer to emerge.
Price risks
- Slower-than-expected AI or grid investment could weaken demand growth.
- Faster project approvals could add supply sooner than BHP expects.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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