A Looming Copper Shortage Could Reshape the Global Economy by 2040

A global copper shortage is emerging as one of the most underappreciated risks facing the world economy. According to S&P Global, the shortfall could reach as much as 10 million metric tons by 2040, a scale large enough to disrupt multiple industries at once.

Copper sits at the centre of modern economic activity, quietly powering everything from construction to data centres. As electrification accelerates, demand for copper is rising far faster than new supply can realistically come online.

The energy transition is a major driver behind the looming copper shortage. Electric vehicles, renewable power grids, battery storage systems, and charging infrastructure all require significantly more copper than traditional fossil-fuel systems.

At the same time, the supply side is struggling to keep pace. New copper mines take years, often decades, to permit, finance, and develop, while existing mines face declining ore grades and rising extraction costs.

Geopolitical risk adds another layer of pressure to the copper shortage outlook. Many of the world’s largest copper reserves are located in regions with regulatory uncertainty, resource nationalism, or political instability.

A sustained copper shortage would have knock-on effects across global industries. Higher copper prices could slow infrastructure projects, raise manufacturing costs, and complicate the rollout of clean energy technologies.

From a macroeconomic perspective, copper shortages introduce inflationary pressure. When a foundational industrial metal becomes scarce, cost increases ripple through supply chains and ultimately reach consumers.

For investors, the copper shortage narrative is increasingly hard to ignore. Long-term supply constraints paired with structural demand growth create conditions that could support elevated prices over extended periods.

The key risk is timing rather than direction. Even if demand forecasts moderate, current investment levels in new copper supply appear insufficient to prevent a material shortage by the late 2030s.

As global economies push toward electrification and decarbonisation, copper is no longer just another commodity. It is becoming a strategic resource, and the emerging copper shortage could define the next phase of industrial growth.