Crisis in the copper chain: innovation, geopolitics and Australia's role

Yahoo

07-07-2025

As demand for clean energy tech rises, the global copper market is facing a supply-demand gap that analysts warn could be near impossible to close if production remains at its current levels.
Adding to the market volatility are US president Donald Trump's threatened tariffs, and his executive order to fast-track US exploration and mining of critical minerals, including copper, in international waters.
In the face of supply chain uncertainty, countries are prioritising sovereign access to copper. This means targeting new or previously inaccessible deposits, often deeper and more remote than previously seen, while innovators rush to develop technology that could make lower-grade ore economically viable.
While Australia is by no means the biggest copper producer (ranking eighth globally in 2024), it is home to the world's second largest copper reserves, making it a key player in any long-term production strategy.
With questions over how nations will meet copper demand without triggering further instability, we look at the projects working to keep Australia's supply afloat in an uncertain time.
Currently, copper demand sits at around 25 million tonnes (mt) per year. However, estimates suggest that the market trajectory is pushing towards a demand of 50mt by 2050.
Ollie Brown, an economist at GlobalData, told Mining Technology that this demand, similar to other critical minerals, is primarily driven by electric vehicles, grid renovations and renewable energy initiatives.
Amid growing demand, he says the global copper market is defined by 'lagging supply', while Trump's threatened tariffs from the beginning of this year are 'rattling global prices.'
While Trump has not set a levy against copper specifically, he has made it clear that he wants to cut back on imports and increase domestic production.
In February 2025, he commissioned the US Department of Commerce to investigate potential national security risks of copper imports ─ the first step towards potentially curbing these goods.
While the tariffs and their impacts remain conjecture at this stage, Nicolas Psaroudis, APAC economist at GlobalData, told Mining Technology the threat of restrictions contribute to uncertainty and price volatility.
'Internationally, export restrictions could disrupt global copper supply chains,' he explains. 'A sudden drop in supply could tighten global scrap availability, drive up international prices, and strain smelters already facing concentrate shortages.'
If nothing else, the situation has proven an unwelcome reminder of the fact that global mineral supply chains remain vulnerable to the whims of trade tensions and has added to calls to bolster domestic production.
Lawrence M. Cathles, professor of earth and atmospheric sciences at Cornell University, says Western nations need to be more willing to expand operations to avoid market dependence.
'It's not enough to say copper is important while refusing to do the work,' says Cathles. 'We don't want anybody to control any major commodity, but just not wanting that isn't enough. You've got to have policies and plans in place to avoid undesirable situations – and part of that is mining in our own territory.'
Yet while Australia has no shortage of copper ore, the issue lies in accessing it.
According to Dan Wood, exploration geologist and University of Queensland (UQ) adjunct professor, one of the main challenges is finding copper ore that's viable for development.
'Almost all of the large deposits theoretically available to replace one of the top-ten producing mines that will close in the early-2050s have all failed at least one mining feasibility study,' he says.
These failures are mainly due to low ore grades and remoteness, as well as low copper prices. Even if prices rise enough to make low-grade copper development viable, Wood cautions that oversupply could trigger a feedback loop: more copper brings prices down, undoing the gains.
To make the most of Australia's deposits, Wood says more should be done to access deeper ore bodies. One potential method is caving, when the rock is 'undercut' or drilled beneath the surface and recovered as it falls.
While the practice is not uncommon - for instance, it is used in Sweden for iron ore - little is known about how to safely mine beyond a certain depth, and education and training around the method remains low.
'Caving isn't uncommon, but the scary thing is there are so few people left in the world who really understand it,' Wood states. 'If you go deeper than around 1.4 kilometers, there isn't much data on the rock stressors. Take Rio Tinto's Resolution deposit in Arizona. You have to go down nearly two kilometers before you reach the top of the ore, and the rocks that deep are nearly 100 degrees centigrade.'
Initiatives to train the next generation of caving miners do exist - for instance UQ has partnered with Rio Tinto and the University of Mongolia to scale up caving expertise at Rio's Oyu Tolgoi mine in Mongolia. However, Wood warns the process is a long one.
'We're looking at a 20-year journey to end up with a cohort of properly trained and, most importantly, experienced caving engineers,' he says. 'This skills gap is serious and unless addressed will be a major drag on future copper supply towards 2050.'
Aside from education, technology may provide another route to increasing supply, with innovators looking to make low-grade ores viable development options.
One project, a collaboration between UQ and start-up Banksia Minerals Processing (BMP), is developing a more environmentally friendly means of extracting copper from low-grade resources.
The process relies on hydrometallurgy rather than pyrometallurgy (water rather than heat) to extract copper from the ore; dissolving, purifying and then recovering metals from liquid using electricity.
While the process itself isn't new, having been practiced in the late 1970s in the US, the team had a breakthrough in the purity of the copper produced, making it more viable for commercial deployment.
The method also addresses another issue plaguing copper miners - that of impurities.
Currently, smelters have strict regulations on how many impurities can be processed alongside the copper ore (with arsenic a particularly problematic contaminant).
James Vaughan, head of the university's Hydrometallurgy Research Group, explains the limits are getting increasingly difficult to meet.
'Miners are having to cherry pick ore bodies, and it's a significant limitation on the amount of material that can actually be pulled out of those mines,' he said. 'That's a problem when we need more and more copper."
While the typical smelting method sees arsenic exiting as a gas that can be harmful to both workers and the environment, using a water-based method stores the arsenic in a stable, and disposable, form.
By addressing this challenge, Leigh Staines, managing director of BMP, says the new technology could unlock copper resources previously deemed unfeasible.
'Our hypothesis is that more than half of known copper resources out there are restricted from development due to those smelter intake limitations,' she says. 'By enabling a feasible pathway for processing of those resources, we're then able to unlock the commercial viability of bringing that supply to market.'
The tech can be integrated into modular plants that are anticipated to be far cheaper to construct than traditional smelters ─in the order of hundreds of millions rather than billions ─ and running on an estimated 50% less energy.
As a result, the team say the project could pave the way for an economically viable onshore processing option, and bolster Australia's supply chain independence.
'We see a real opportunity from a sovereign supply perspective – gaining access to not only copper itself but the by-products from copper concentrate,' Staines says. 'In the longer term, if this takes off, I really do think it will become the new norm.'
Yet while innovations such as these show Australia is already on its way to unlocking copper's potential, another persistent concern is that without sufficient funding, even the best tech won't close the gap.
On the global stage, Arthur F. Thurnau, professor of mineral resources at the University of Michigan warns the West is underfunding its mining workforce.
'Governments in Australia, Canada, the EU and the US do not seem to fully appreciate the magnitude of the difference in education and training between these regions and China,' he says. 'Specifically, in the fields of geology and mining, China has more faculty and graduate students within a single university (such as the China University of Geosciences Beijing), than the sum of Australia, Canada, the EU and the US'
Without closing the gap, Thurnau warns that Western nations will be forever trying to catch up to China. '
For Cathles, government attitude is also an issue, though he points more towards a lack of realism in the demand for copper in the path to net zero.
'If the goal is to electrify everything and thereby dramatically increase copper demand - double or even triple it – you can't just suddenly mine more because the mining infrastructure cannot be expanded quickly,' he says.
Instead, he calls for long-term planning: building a skilled workforce and pursuing a more pragmatic clean energy transition that reduces pressure on supply chains.
There may be promising alternatives, he adds, such as battery chemistries that use less copper, pairing renewables with backup systems like gas-powered plants, or a focus on rolling out hybrid rather than fully electric vehicles. While these options may mean it takes longer to reach net zero, Cathles said they lessen the strain on copper production.
'Let's be sensible,' he says. 'We need grounded policies. We shouldn't place sudden, unrealistic demands on sectors that we know can't respond quickly.'
Whether through education, innovation, or a more measured path to net zero, one thing is clear: the world must confront the widening gap between copper demand and supply.
As Cathles and Thurnau both emphasise, the solution won't come from mining alone. It will require strategic investment in human capital, realistic energy policies, and a willingness to adapt. Without these, Western nations, including Australia, risk falling behind - not only in production capacity, but in their ability to lead a sustainable energy transition.
"Crisis in the copper chain: innovation, geopolitics and Australia's role" was originally created and published by Mining Technology, a GlobalData owned brand.
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