Copper Supply Crunch: Exceptional Mines Harder to Find

The global transition to electrification and renewable energy is driving unprecedented demand for copper. As governments around the world commit to climate targets and roll out electric vehicles and infrastructure, annual copper demand is projected to reach 36.6 million metric tons by 2031, up from around 24 million tons today. However, at current production rates, copper supply is expected to reach only 30.1 million tons by 2031, leaving a 6.5 million ton gap.

Bridging this gap through traditional mine expansions and new projects alone will be extremely challenging. Miners would need to increase the volume of ore processed by 44% compared to the last decade, requiring an additional 1 billion tons of ore per year on top of recently announced expansions. With ore grades declining and accessible oxide deposits diminishing, meeting demand growth through traditional methods appears unfeasible.

This is where new mineral processing technologies come in. If successfully commercialised and adopted industry-wide, innovations in areas like coarse particle recovery, sulphide leaching, and process optimisation with machine learning could significantly boost copper production from existing operations to help meet future demand.

Coarse Particle Recovery

One of the most promising innovation areas is coarse particle recovery. Conventional sulphide flotation circuits used to process copper ore are most effective at recovering particles sized 50-150 microns. However, recovery rates drop off steeply for particles above 150 microns. This has forced miners to invest heavily in grinding and milling infrastructure to produce finer particle sizes, increasing capital costs and energy usage.

New technologies are emerging to improve coarse particle recovery beyond 150 microns and unlock value from particles currently being discarded as waste. One example is CiDRA's P29 system, which recovers particles directly from the grind circuit using an innovative “copper sponge” material. Rio Tinto estimates this technology can increase the throughput of existing mills by 20%.

Other systems like Eriez HydroFloat add equipment at the end of circuits to prevent coarse particles from sinking during flotation, improving their recovery. Across the industry, experts estimate improving coarse particle recovery could add 1.2-4.6 million tons of annual copper production by 2032, worth $20-85 billion for all applicable metals. This would come with limited incremental environmental impact and could reduce energy intensity.

Sulphide Leaching

Traditionally, leaching technologies have only been applied to oxide copper ores. But new techniques are enabling the leaching of primary sulphide ores, which make up the bulk of remaining copper deposits.

Rio Tinto’s Nuton system uses bio-leaching to extract copper from sulphide ores. Other companies like Jetti Resources have developed catalysts to improve sulphide leach kinetics. These technologies allow economic recovery of ores below 0.25% copper, which are currently considered waste.

By applying sulphide leaching to existing stockpiles and run-of-mine waste, experts estimate global copper production could increase by 2.4 million tons per year by 2032. This would come with a lower water usage and tailings profile compared to conventional flotation approaches. Across applicable metals, sulphide leaching offers a $45 billion annual opportunity.

Process Optimisation with Machine Learning

A key challenge in mineral processing is managing variability in ore composition feeding into plants. Traditionally, experienced metallurgists made adjustments, but human factors lead to suboptimal recoveries.

Machine learning can now provide prompts to operators while adding speed, rigour and consistency. Solutions like VisualMind’s Intelligent Control Room use predictive analytics and models to keep plants consistently at peak performance.

By optimising recoveries and throughput, machine learning could boost global copper production from existing operations by 0.5-1 million tons per year by 2032, worth $9-18 billion across applicable metals.

Unlocking the Potential

To fully capitalise on these innovations, stakeholders across the industry should look to:

• Mine operators: Fund internal innovation teams and partner flexibly with juniors/tech firms to implement new technologies. Maximise brownfield expansions leveraging new techniques.
• Developers: View majors as partners to provide funding and scale to grow innovations. Explore "incremental mine" models enabled by sulphide leaching.
• Metal buyers: Proactively fund and promote tech breakthroughs across supply chains. Recognising new technologies can boost responsible production.

Where will the new copper come from?

With declining ore grades and few new major deposits being discovered, traditional mine expansions alone will not meet rising copper demand. But by embracing new processing techniques like coarse particle recovery, sulphide leaching and process optimisation, in tandem with some traditional projects, the industry can come closer to delivering the copper needed for electrification and renewable energy targets in the coming decade. Investors and companies who recognise these technology opportunities early can position themselves for value creation as the copper supply crunch unfolds.

It's true that copper demand is increasing rapidly due to electrification and renewable energy transitions, but we are not yet running out of copper reserves globally. Here are a few key points on the current copper supply and demand dynamics:

• Known global copper reserves are estimated to be around 870 million tonnes, with the largest reserves located in Chile, Australia, Peru and Mexico. At current production rates, these reserves are estimated to last another 50-60 years.
• However, copper is becoming more difficult and expensive to mine as grades decline and new deposits become harder to find. This is constraining supply growth to meet rising demand.
• Copper demand is projected to grow steadily, potentially doubling by 2050 due to electric vehicles, renewable energy, batteries and electrical infrastructure. New technologies like EVs use 2 to 10 times more copper than conventional cars.
• There is a projected supply gap of around 5-8 million tonnes by 2030 as demand growth outpaces new supply. But this gap could be reduced through ore grade improvement, better recovery rates and recycling.
• Recycling of copper is increasing but is still relatively low compared to availability. Less than 30% of copper is currently recycled. More recycling, especially from end-of-life products, could significantly help meet future demand.
• New technologies like coarse particle recovery, sulphide leaching and automation can boost supply from existing mines beyond what was previously feasible. But these technologies need further commercialisation.
• Overall, while copper is not yet scarce, new supply sources and technologies need to be brought online to meet rapidly rising demand and avoid a potential future supply crunch. But with sufficient investment and innovation, copper shortages can likely be avoided.

So in summary, we are not yet running out of copper reserves globally, but increased production and recycling, new technologies and discoveries will be needed to meet future demand and avoid potential shortages. The situation needs careful monitoring and proactive steps by producers, users and recyclers.