Chile's Codelco, the world's largest copper producer, warned that the global copper demand gap will reach 8 million tons by 2032 as demand growth continues to outpace new project capacity, Mining.com reported.
Maximo Pacheco, chairman of Codelco's board of directors, told an industry conference that while new projects in Chile, Peru, the Democratic Republic of Congo and China's Tibet region would provide a short-term surplus, supply would remain tight in the medium to long term.
"Given that some mines are already out of production and others are just starting to come on stream, the shortfall in 10 years is close to 8 million tonnes," Pacheco predicted at the Asia Copper Week conference in Singapore.
Mr Pacheco's view is similar to that of several analysts, who forecast a shortfall of 6m tonnes a year over the next decade, due to rapid growth in the clean energy and electric vehicle sectors.
Based on Codelco's research, Pacheco believes that the energy transition to combat climate change will increase copper demand from 25 million tonnes today to 31 million tonnes in 2032.
That means the world needs to build eight new giant copper mines the size of BHP's Escondida mine in the next eight years. Escondida, in Chile, is the world's largest copper mine.
Erik Heimlich, head of base metals supply research at the UK Commodity Institute, said that such a "difficult" task looked likely only "Possible" rather than "Probable", with the fact that half the project was still greenfield.
"Historically, these projects have not had a high completion rate. Most of the greenfield projects in 2012 have yet to be developed, so it is questionable whether they will be able to fill the gap effectively and in time, "he said at a copper conference in Chile earlier this year.
Experts estimate the global copper industry will need to invest more than $100 billion in mines to fill a supply gap of 4.7 million tonnes a year by 2030.
"If new mining projects do not come on stream, there will be significant demand in the second half of the next decade, starting in 2016," Pacheco warned.
Some large mines have come on stream in the past three years. First Quatum Minerals' copper mine in Panama began production in September 2019. The mine has proven and approximate reserves of 3.1 billion tons and could produce more than 300,000 tons of copper per year when fully reached.
Ivanhoe Mines began producing copper concentrate at its Kamoa-Kakula project in the Democratic Republic of Congo in May last year, with production starting in July 2021.
Anglo American's Quellaveco copper project in Peru's Moqugua region began mining in October 2021 and was declared operational in September 2022. The mine is expected to produce 120,000 to 160,000 tons of copper this year, up from an average annual output of 300,000 tons for the first 10 years. That will make Klavico the country's largest new copper mine after Minmetals' Las Bambas mine opens in 2016.
