Demand for AI is surging, and the price of this metal is about to skyrocket

Demand for copper is surging due to the artificial intelligence revolution and the upgrading of power grids, while supply is shrinking due to declining ore quality and delays in opening new mines. Estimates suggest the market could face a severe structural shortage as early as 2028, potentially driving prices upward. Major technology companies, including Alphabet, Amazon, Microsoft, and Meta, are expected to spend $735 billion on capital investments this year, primarily for data centers.

Demand for copper is surging due to two main factors: the artificial intelligence revolution, which is driving the construction of massive data centers, and the upgrading of power grids in the US and Europe. Major technology companies, including Alphabet, Amazon, Microsoft, and Meta, are expected to spend $735 billion on capital investments this year, most of which is earmarked for data centers. An advanced data center requires up to 50,000 tons of copper, compared to 5,000 to 15,000 tons for a standard center. Demand for copper for AI and data centers is expected to triple by 2040. On the other hand, supply is weakening: in countries like Chile and Peru, ore quality is declining, and opening new mines takes 16 to 18 years due to regulatory approvals and high costs. Despite a temporary easing in 2027, 2028 is expected to mark the beginning of a severe structural shortage. The article concludes with a clarification that the content is not investment advice.