Consultancy Wood Mackenzie says the power grids needed for AI data centres will use three to four times more metal than the data centres themselves, while new mine approvals are lagging. It sees copper markets outside the US already short of about 450,000 tonnes.
At a glance
- Wood Mackenzie is tracking more than 250 GW of planned data centres, over three times last year's pipeline.
- The world needs about 850,000 tonnes of new greenfield copper output every year for a decade, it estimates.
- Aluminium faces a 1-million-tonne deficit in 2026 after attacks on two Middle Eastern smelters.
Background
Wood Mackenzie is an energy and natural-resources research firm whose forecasts are widely used by miners and investors. Data centres need huge amounts of electricity, and the lines, substations and power plants that supply them are built largely from copper, aluminium and steel. A greenfield mine is a new mine built from scratch rather than an expansion of an existing one.
What Wood Mackenzie said
Wood Mackenzie expects electricity use linked to AI to grow fivefold between 2025 and 2030 and pass 1,000 terawatt-hours (TWh) by 2035, MINING.COM reported on October 22. The transmission lines, substations and power plants serving data centres could need three to four times more metal than the centres themselves.
Supply is not keeping up. "High prices should trigger investment, yet project sanctioning remains below expectations," said Lindsay Grant, vice-president of metals and mining research. Long permitting, geopolitical uncertainty and more complex projects are all slowing new mines.
Copper is the tightest
Copper has reached a record $14,759 a tonne as US stockpiling and trade policy pull metal into America. US stocks now cover more than 170 days of demand, against just 48 days elsewhere, which leaves the rest of the world about 450,000 tonnes short of refined copper.
Chile's mine output is forecast to fall 5.2% this year. Global output should grow more than 5% in 2027 after three flat years. Even so, Wood Mackenzie says miners must add about 850,000 tonnes of new greenfield production a year over the next decade.
Aluminium and nickel
Attacks on two major Middle Eastern smelters removed almost 2% of global aluminium production, contributing to a projected 1-million-tonne deficit in 2026. Chinese smelters are running at 99% of capacity, and Wood Mackenzie expects a return to surplus in 2027.
Refined nickel output is forecast to fall 2% in 2026, its first decline since 2015, as Indonesian mining quotas tighten supply. Wood Mackenzie sees nickel prices recovering towards $19,000 a tonne by 2030.
What it means
The view cuts against some voices at this week's LME Week in London, where Macquarie's Alice Fox called AI's boost to copper demand overhyped. Wood Mackenzie's argument is less about the chips and servers. It is about the power grid AI needs, and how slowly new mines come online to supply it.
Our read
Outlook: bullish. Wood Mackenzie sees demand from power grids rising while new mine supply lags, which supports copper prices over the longer term.
What to watch
- Whether high prices lead to more approvals of new copper mines.
- Any US decision on tariffs for refined copper, which affects how much metal stays in American warehouses.
- The pace of aluminium restarts in the Middle East and new capacity in Indonesia.
For information only, not investment advice.
Copper price in India
metalscost.com India reference price as of 2026-11-07.
Detailed analysis
Demand Drivers
AI-related electricity use is forecast to grow fivefold from 2025 to 2030, driving grid and power-plant construction.
Supply Drivers
Mine approvals lag despite high prices, and Chile's copper output is set to fall 5.2% this year.
Inventory Drivers
US stocks cover more than 170 days of demand against 48 days elsewhere, distorting global availability.
What could lift prices
- Grids serving AI could need three to four times more metal than the data centres.
- Markets outside the US face a refined copper deficit of about 450,000 tonnes.
What could weigh on prices
- Global copper mine output is expected to grow more than 5% in 2027.
- If US trade policy changes, metal held in US warehouses could flow back to world markets.
Country impact
| Country | Impact | Reason |
|---|---|---|
| United States | High | Its stockpiling holds more than 170 days of copper cover while the rest of the world runs short. |
| Chile | Medium | Mine output in the top copper producer is forecast to fall 5.2% in 2026. |
| Indonesia | Medium | Its nickel quotas are cutting supply, while its aluminium output heads towards 3 million tonnes by 2030. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Copper Mining | Positive | Record prices and a large supply gap strengthen the case for new mines. |
| Data Centers | Negative | Developers face slow grid connections and higher costs for metal-heavy power infrastructure. |
| Power Transmission | Neutral | Grid builders gain work but must compete for scarce copper and aluminium. |
Who gains, who loses
- Copper miners with new projects: Wood Mackenzie sees a need for 850,000 tonnes of new output a year.
- Copper buyers outside the US: They face a refined deficit of about 450,000 tonnes while metal sits in US warehouses.
Other ways this could play out
- If miners approve more projects at current prices, the supply gap could narrow after 2030.
- If AI data centre plans are scaled back, grid demand for metals would grow more slowly.
Price risks
- A slowdown in global growth could cut copper demand faster than supply tightens.
- Other analysts argue AI's effect on copper demand is overstated.
Historical comparison
- 2015: The last time refined nickel output fell in a year, before the 2% drop Wood Mackenzie expects for 2026.
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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