AI data centers use less copper

The construction of artificial intelligence data centers uses significantly less copper than traditional industries, according to data presented at the LME Week in London. Despite copper prices reaching around $14,000 per tonne, these data centers account for only about 3.6% of global copper consumption, compared to the 28 million tonnes used annually worldwide.

Copper demand from AI is limited

A detailed analysis by Les Echos indicates that an investment of $1 million in data centers generates a demand for approximately 600 kilograms of copper. In contrast, the same investment in construction or the automotive industry would mobilize between 1.5 and 1.8 tonnes of copper. Graeme Train of Trafigura notes that AI is about three times less metal-intensive than traditional sectors.

Tin and lead gain attention

While copper remains in focus, other metals like tin and lead are becoming increasingly important for AI data centers. Tin, used in soldering components on motherboards and graphics accelerators, has seen its price rise from $20,000 to over $50,000 per tonne since late 2022. This increase highlights the growing importance of these less traditional metals in electronic manufacturing.

Lead's resurgence in data centers

Data centers are also driving renewed interest in lead, primarily due to their reliance on uninterruptible power supply (UPS) systems. These systems use lead batteries to manage micro-power outages, accounting for 8% of global lead consumption. This is nearly three times the share of copper in the same category.

Copper price rise has other causes

Despite the limited impact of AI data centers on copper demand, copper prices have continued to rise. According to Crédit Agricole, this is largely due to a decrease in copper extraction, including a 2.5% decline in South America. This supply-side issue is a key driver of the current price surge.

Opportunities in copper stockpiles

The rising copper prices have created opportunities for telecommunications infrastructure managers. By replacing old copper networks with fiber optics, companies can sell off large quantities of copper. For example, the British operator Openreach has already extracted over 22,000 tonnes of copper from its network, turning it into a valuable asset.