Wood Mackenzie's new analysis shows that geopolitical disruptions, resource nationalism, and the increasing inability to supply electricity are reshaping the global base metals markets. With the global data center pipeline exceeding 250 gigawatts, demand for electricity infrastructure is rising sharply, intensifying competition for copper, aluminum, and other strategic materials.
AI Metal Impacts
The impacts of metals driven by artificial intelligence extend beyond the data centers themselves. Transmission networks, booster stations, and dedicated power generation may require three to four times more metals than needed for their facilities. This has emerged as a new source of structural demand following electrification and investment in energy security.
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Investment Challenges in the Upstream Sector
Despite high prices for commodities, investment in projects remains below expectations. Delays in permitting, geopolitical uncertainty, and increasing project complexity act as major barriers to investment decisions. These challenges arise as governments place greater emphasis on the importance of supply chain resilience and the security of critical minerals.
Lindsay Grant, Vice President of Metals and Mining Research at Wood Mackenzie, stated: "Data centers present an infrastructure challenge for electricity supply at the economy level, but the bigger story is the clash between rising demand and a more complex supply delivery." She also added: "High prices should stimulate investment, but project permitting remains below expectations. Without faster approvals and investment commitments, the industry cannot provide the necessary mining supply to support future growth."
Wood Mackenzie's analysis identifies four structural themes that will shape metals markets and investment decisions through 2036.
State of the Base Metals Market
Copper prices have reached a record $14,759 per ton, indicating severe disruption in the refined market. While Chilean mine production is expected to decline by 5.2% in 2026, global mine supply is expected to increase by over 5% next year. The aluminum market is also facing a 2% decline in global primary production due to damage to Middle Eastern smelters.
The nickel market will return to balance in 2026. However, this superficial stability conceals a deep structural duality. Estimates suggest that the industry needs to provide approximately 850,000 tons of new green copper supply annually over the next decade.
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