ICA Europe Policy Priorities 2024-2029

by

🇪🇺 Europe needs a strong industrial policy 🏭

This industrial policy should address strategic net-zero value chains, from raw materials like copper to clean technologies like wind, solar, and heat pumps. It should facilitate the right conditions for investing in strategic raw materials needed to deliver a climate-neutral and resilient Europe.

ICA Europe members are committed to delivering more copper mining, copper recycling and copper refining capacity in Europe and abroad in order to deliver the copper needed for the energy transition.

For this to happen, we have identified five key proposals for the next EU Commission and EU Parliament. These proposals relate to the industrial policy, the regulatory environment, the implementation of the Critical Raw Materials Act, the access to energy, and the market outlook for clean technologies.


About ICA Europe

Based in Brussels, the International Copper Association (ICA) Europe is the leading advocate for the copper industry in Europe. As ICA’s European branch, the organisation represents companies that mine, smelt and recycle copper for use across the economy, in the electricity system, buildings, transport and industry. Through a team of policy, industry and scientific experts, ICA Europe promotes copper as an essential material for achieving the EU’s ambition of a resilient, climate-neutral Europe and seeks to ensure that EU policies enable the sustainable production of copper to serve Europe’s future needs.

Contact: Ignacio Gentiluomo, ignacio.gentiluomo@internationalcopper.org, +32 490 42 84 63

ICA-Commissioned Research Shows Energy Transition Will Support Global Copper Demand

by

Future copper market share will be heavily shaped by regional responses to the global shift to a low-carbon economy.

This was the focus of ICA’s “Future Market Share” panel, which drew on two pieces of ICA-commissioned research (Copper: A Long-term View of Demand and Competitive Market Share authored by CRU and Copper Use, Substitution, and Market Share authored by DMM Advisory Group). Moderated by Ernest Scheyder, Senior Mining and Future Energy Correspondent at Reuters, the panel presented a compelling discussion to a room full of analysts, journalists and members of the copper industry at the CRU World Copper Conference 2024, part of CESCO week, in Santiago, Chile.

The CRU research demonstrates that global copper demand is forecast to grow from 28.3 million tonnes (Mt) in 2020 to 40.9Mt in 2040 with a Compound Annual Growth Rate (“CAGR”) of 1.85 percent. This growth is anticipated to come from traditional demand sectors as well as from new sectors driven by the green energy transition, such as growth in electric vehicle adoption, renewable energy integration, and grid infrastructure expansion and maintenance.

Speaking on the regional variation in copper demand, panelist Juan Brihet, CRU Senior Consultant, remarked that “while demand is expected to grow across all regions globally over the forecast time horizon, there are disparities in growth across different regions.” This was echoed by Charlie Murrah, Executive Vice President/Chief Supply Chain Officer of Southwire Co., who asserted that “copper and aluminum demand is often driven by the regional macro-economic environment. The supply of the natural resources needed to satisfy demand is often disjointed.” This regional variation is outlined in the CRU study, which identifies major growth for copper demand in India, with a CAGR of 7 percent, closely followed by the ASEAN region with forecast growth of 6 percent.  While these regions are expected to lead the way, CRU projects demand growth will reach 3 percent in North America, 2 percent in South America and less than 1 percent in both China and Europe.

Various geopolitical, economic and demographic factors are driving these regional differences in copper demand. The research explored these macro trends:

As identified by the CRU research, regional responses to the vast requirements of the green energy transition are a significant contributing factor to copper use trends across the world.

This is, arguably, best exemplified by wire rod, which is the principal application for copper, constituting an expected ~60 percent of total demand share over the long term. Wire rod copper demand is expected to reach over 25Mt by 2040, predominately driven by the buildout of energy infrastructure.

As global regions build out their energy infrastructure, wire rod demand will increase at a CAGR of 1.8 percent, in line with total copper demand, according to the CRU research. Total wire rod tonnage will also increase by approximately 7.5Mt globally between 2020 – 2040. Copper wire rod is used for manufacturing various types of copper wire, which ensures that it is a central part of power transmission, electrical components, cable constructions and other industrial applications.

The CRU research shows that a similar trend emerges for copper cable demand, with green-related applications offsetting the slower growth rate from traditional demand areas. While copper demand in traditional applications is only projected to increase by 0.5 percent, copper is expected to see an 11 percent demand growth from EVs and chargers, a 19 percent growth from grid expansion and a 7 percent growth from renewable energy technologies. Overall, wire and cable use related to the green energy transition is expected to increase from 0.8Mt to 6.7Mt between 2020 – 2040.

While “the green energy transition supports most of the global copper demand in the long term,” according to Brihet, copper substitution with aluminum remains a risk. DMM Advisory Group’s research centers on this, with panelist Krisztina Kalman-Schueler, DMM Advisory Group Managing Partner, asserting that “in 2023, net substitution constituted 1.45 percent of copper use or 1.8 percent of copper use including miniaturization.”

The DMM Advisory Group research outlines that, although emerging applications present an opportunity for copper to grow its market share, there is potential for key copper applications to be at risk of substitution. The panel identified heat pumps as an important emerging application for copper. Heat pump demand is expected to grow, reflecting the observed trend of green applications driving increases in copper use. As Brihet asserted, “CRU expects annual heat pump sales to quadruple by 2040, going from sales of 13 million units to 52 million units between 2020 to 2040.” Kalman-Schueler also remarked on this growth potential, commenting that “heat pumps are an example of a growing energy transition market and are an energy-efficient, low-carbon, low-cost heating solution.”

If global copper markets can effectively meet these growth requirements, future copper market share will remain positive, driven by the green energy transition and regional demand trends.

 

Serving as Responsible Stewards

by

The Paris Agreement was signed on Earth Day in 2016. Signers of the Agreement committed to reaching net-zero carbon emissions by 2050. With this Agreement in mind, the International Copper Association (ICA) and its members have set goals to reach net zero in Scope 1 and 2 greenhouse gas (GHG) emissions by 2050. Earth Day is a global call to action each April 22, and ICA members are answering. 

Sustainability at ICA 

Since 2011, ICA has conducted a voluntary member survey to collect social, economic and environmental data. All surveyed ICA members have reduction targets and are actively working to decarbonize their operations, reduce waste and reuse water. 

Energy Use 

Copper production requires significant amounts of electricity, heat and fuel. The industry is actively shifting toward renewable energy to reduce energy use and emissions. Declining ore grades have caused energy intensity rates to gradually increase over time. However, innovations in mining and processing technologies have enabled ICA members to increase productivity and mining efficiencies, extending the lifetime of existing mines. This extension of mine life decreases the energy required for exploration and development of new sites. 

The majority of GHG emissions come from transportation. Haul trucks, which are used to transport ore and rock, typically weigh around 400 tonnes and consume a large amount of fuel. Many ICA members are working on implementing vehicles with increased fuel efficiency, as well as transitioning to electric fleets, which could cut transportation GHG emissions to zero. 

In addition, members are sourcing energy from renewable sources, including solar, wind and hydropower. This enables decreased GHG emissions in the industry even with increasing energy use. While the copper industry is a large energy consumer, copper contributes to a reduction of over 100 million tonnes of GHG emissions per year through its role in green technologies.   

Diverting Waste from Landfill 

As part of ICA’s member data collection, members reported on the amount of waste generated during the production process and how much was recycled, downcycled or repurposed instead of landfilled. On average, surveyed members diverted over one quarter of their waste from landfill. 

For example, recycling HDPE pipes, which are used extensively for moving secondary materials in mine production, is a common practice in circular mining. Downcycling, another circular mining practice, can reduce waste by adding recycled copper scrap from fabrication back into the refining process. Many resources can be recovered during the production process and repurposed for use across industries. This is referred to as industrial symbiosis and can include recovery of iron silicate, a byproduct from processing copper slag, into a marketable product for construction and building materials. This lessens landfilling and reduces GHG emissions for the companies utilizing this product, as production does not require additional energy. To learn more about industrial symbiosis and how it contributes to the circular economy, click here. 

Recycling and Reusing Water 

The entire copper production process employs water. An increase in water stress poses a potential challenge for the industry. Water does not need to be potable for copper production, but there are limits to the levels of particulate matter in the production process.  

On average, two-thirds of ICA member operational water requirements are met through water recycling. This means only around one-third of the water use comes from outside water sources. Several ICA members utilize desalination techniques on sea water to avoid extraction of valuable freshwater sources; other members leverage treated municipal wastewater. Both techniques are becoming increasingly valuable, especially in water stressed areas. In addition, members are locating efficiencies in their processes to limit the amount of water needed.  

ICA members are not only working to reduce water use through water recycling and desalination, but they are acting to provide their communities with access to potable drinking water whenever possible, from capturing rainwater to providing their own technologies to improve and expand access to freshwater. Producing copper responsibly requires a wholistic approach, addressing the key drivers of environmental impact by decreasing energy use and emissions, reducing waste and utilizing natural resources efficiently in cooperation with local communities. As the copper industry works to meet the growing needs of the clean energy transition, ICA members are striving to serve as responsible stewards of both the material and the environment.

Regional trends and the green energy transition are expected to increase global copper demand by 12.6Mt from 2020 to 2040

by

ICA to host a panel discussion on Future Market Share at the CRU World Copper Conference 2024 in Santiago, Chile—part of CESCO Week

Washington, D.C. – Research from the CRU Group, commissioned by the International Copper Association (ICA), reveals copper’s future market share will be defined by regional trends and the green energy transition, which are expected to help drive copper demand from 28.3 million tonnes (“Mt”) in 2020 to 40.9 Mt in 2040, with a 1.85 percent compound annual growth rate (“CAGR”).

On a regional level, CRU’s research forecasts that the strongest growth in copper demand is expected in India with a 7 percent CAGR, closely followed by the Association of Southeast Asian Nations (“ASEAN”) with a 6 percent CAGR. Both regions are currently observing high growth in the manufacturing and construction industries.

Specifically, India and ASEAN are expected to see the highest growth rates in wire rod demand. However, China is expected to remain the largest wire rod user. Juan Brihet, Senior Consultant at CRU, confirmed that “This demand, which is forecast to be primarily driven by the development of energy infrastructure, is expected to ensure that wire rod remains the largest segment of total copper demand at an estimated 25 Mt by 2040, constituting approximately 60 percent of total demand share over the long term.”

Green applications are also predicted to influence copper tubing demand, which ICA–commissioned research from the DMM Advisory Group expects to add nearly 1.6 Mt to copper demand from 2020 – 2040. Air source heat pumps should be a significant contributing factor, with the research anticipating sales of these pumps will quadruple by 2040, from 13 million units in 2020 to 52 million units in 2040. Krisztina Kalman-Schueler, Managing Partner at DMM Advisory Group, commented that “heat pumps are an example of a growing energy transition market, and are an energy efficient, low-carbon, low-cost heating solution.”

CRU anticipates that copper wire and cable will see a slight decrease in global market share from 2020 to 2040 due to copper substitution. The research finds that winding wire will decline from 88 to 86 percent of market share, with power cable decreasing from 64 to 59 percent and automotive low voltage electricity decreasing from 95 to 85 percent.

“While the research finds wire and cable copper are expected to lose around 3 percent of the market by 2040, copper is predicted to retain an 80 percent market share in the long term, and substitution will be offset by gains in total copper usage, primarily driven by growth in end-use applications and the green energy transition,” explained Colin Bennett, Director of Global Market Intelligence at ICA.

Panel discussion

To provide further insight on the ICA-commissioned research on copper’s future market share and substitution, ICA will be hosting a panel discussion on Tuesday 16 April 2024 as part of the CRU World Copper Conference 2024 in Santiago, Chile, during CESCO Week. The panel discussion will take place from 2:45 p.m. – 3:45 p.m. (CLT) at the W Santiago Hotel.

Senior Mining and Future Energy Correspondent at Reuters, Ernest Scheyder, will be moderating the panel. He will be joined by CRU Senior Consultant, Juan Brihet; DMM Advisory Group Managing Partner, Krisztina Kalman-Schueler; and Executive Vice President/Chief Supply Chain Officer of Southwire Co., Charlie Murrah.

The panel will provide an informative and engaging session from key sector experts to discuss the work commissioned by ICA’s Market Outreach Division, led by the Director of Global Market Intelligence, Colin Bennett. The panel will address the stabilization of copper substitution in 2022 and 2023, as well as the outlook on copper’s global market share.

The panel discussion will be followed by a Q&A where the panelists will be available to answer any questions on the topics discussed.

 

  1. Quotations attributed to Juan Brihet are based on ICA-commissioned research finalized in early 2024.

 

About the International Copper Association

The International Copper Association (ICA) brings together the global copper industry to promote, develop and defend markets for copper. Headquartered in Washington, D.C., ICA has offices in three primary regions: Asia, Europe and North America. ICA and its partners are active in more than 60 countries worldwide. For additional information, please visit www.internationalcopper.org.

 

Media contact:

BlytheRay (Financial PR)
Tim Blythe / Megan Ray
+44 (0) 207 138 3204
ICA@blytheray.com

International Copper Association
Nicole Witoslawski
+1 646 350 9968
nicole.witoslawski@internationalcopper.org