Copper Prices Expected to Surge by 75% in 2025

The price of copper is expected to increase 75% between now and 2025, driven mainly by the global shift to renewable energy sources. The positive outlook for copper is changing the mining sector's strategies, as several Mexican mining companies have announced their intention to launch copper projects.

The current copper price stands at US$8,399.94/mt, up from US$8189.59/mt in December and up from US$8375.40/mt in January 2023. This represents a month-on-month variation of 2.57% and a year-on-year variation of 0.29%. In a study, Fitch Solutions stressed that two favorable conditions have been created for copper prices to rise by 2025: new green demand and the expected decline of the US dollar. Goldman Sachs also agrees with these expectations and forecasts a price of US$10,000/mt in 2024 and US$15,000/mt in 2025.

Although there are many factors favoring copper, the main one will be the transition to green energy. More than 60 countries have set ambitious targets to triple global renewable energy capacity by 2030. Citibank estimates that these efforts will result in substantial growth in copper demand, reaching 4.2Mt. "Copper is truly perfect. It is essential to achieve a low-carbon world. I believe that the future of industry, society and our lives will largely depend on copper, as there is no other replacement for it. Perhaps silver could be an option, but it is more expensive. As a result, copper will be the metal to lead the world's green transition," Steve Roberston, CEO, Infinitum Copper, told MBN. 

While the demand for copper is on the rise, Warwick Smith, CEO, American Pacific Mining, warned that the world may face a copper crisis in over 10 years due to a potential shortage in supply. “If you want to be carbon neutral by 2050, you will have to take the amount of copper that has been produced since the beginning of time and triple it in the next 20 years or so. It is wild how much copper will be needed,” he added. 

Mexico currently ranks ninth worldwide in copper production. In 2022, Mexico produced 753,885t of copper, showing a 2% increase over 2021, CAMIMEX reported. In 2022, Grupo México was the largest copper producer in Mexico with a 73.3% share, followed by Minera Frisco, Santa María de la Paz y Anexas, Capstone Copper, and Invecture Group. 

In Mexico, companies like Torex Gold, Sierra Metals and Grupo Mexico are increasingly expressing interest in copper projects, recognizing its growing importance in sustainable operations. Armando Alatorre, Vice President, CIMMGM, explained that the copper boom is anticipated to unfold over a span of 10 to 15 years. This implies that companies need to expedite the exploration of projects promptly to capitalize on emerging opportunities. Ensuring water efficiency will be key to developing such projects as over 40% of copper projects are in areas with high-water stress, as noted by Fernando Alanís, CEO, Industrias Peñoles' Baluarte Minero division.