Mankind is bracing themselves for yet another Copper Age. As counter-intuitive as it may sound, a copper revolution is already in the works. Unprecedented demand in advanced industrial, energy and consumer applications is pushing up the demand for copper globally. Electric cars are expected to fuel a nine-fold increase in demand for the metal by 2027, while equipments in renewable energy generation such as PV systems, wind turbines as well as energy storage systems require substantial quantum of copper.
Short-term triggers such as a steady global economic recovery, China’s resurgence after an industrial slowdown and President Trump’s plans to boost US infrastructure are accelerating copper demand and sentiment towards the metal. Massive electrification projects in emerging markets are other immediate drivers of demand. Global copper supply, however, lags the projected demand. As a matter of fact, it has fallen in the past few months.
In terms of copper consumption, India is at an interesting stage. A burgeoning economy, India’s per annum demand currently stands at 970 kt and is expected to touch 1,800 kt by FY26. Half of the total demand is met through supply from domestic refined copper producers, around a third from imports and the remaining 20 per cent from recycled copper. Around a third of demand driven by imports is quite high and is expected to rise if projections are to be believed. In fact, there are reports that the country may become a net importer by FY20.
It is critical that India become self-sufficient in its need for copper. There are evident benefits to this—on the one hand it would boost the domestic copper industry, while on the other reducing reliance on imports. The government’s massive electrification project is a major driver for copper demand; also, a paradigm shift towards renewable forms of energy has only increased copper consumption. Such trends would only increase demand in the years to come.
What this also means is that copper is indispensable for the government’s ‘Make In India’ initiative to be successful. In this context, the role of safeguards against imports is key to create a level playing field for the Indian copper industry. Additionally, mining, smelting and refining are also huge job creating sectors for the economy. As oil prices rise steadily owing to geopolitical tensions, it is crucial that the government remove policy bottlenecks and promote the domestic copper industry—this would build an indigenous end-to-end supply chain that doesn’t require any forex outflow.
While these developments concern the economy and the nation, the impact of copper consumption at the individual level weaves an interesting story of its own. The per capita consumption of copper in India is at 0.5 kilo grams. This is way below the global per capita consumption of 2.7 kilo grams. Inclusive economic growth, affordable housing, industrialisation and infrastructure development are the big-bang catalysts that would increase the per capita consumption in the years to come. However, this consumption increase would need to be matched by equivalent levels of supply. This means that India would have to increase its domestic production of copper.
The process of copper production is one that is sustainable. A one hundred per cent recyclable metal with only 12 per cent of the total estimates of copper reserves having been mined till date. Moreover, it is cheaper to recycle copper than to mine and extract it.
Much of the world has touted the 21st century as the space age, a milieu in which humans explore the depths of space and extraterrestrial geographies for signs of life, to colonize and to understand more about the universe. But how much of that is possible without copper?
As India grows from strength to strength into a global economic superpower, the time is opportune to boost its domestic metal production to feed its ever increasing demand. The country has reliable facilities for refining and smelting of copper and these must be allowed to ramp up while new facilities spring up.