Copper is essential for any modern technology. It powers electrical grids and supports clean energy. It’s also used in electronics and vehicles. The U.S. relies a lot on foreign copper supplies. This raises big concerns about supply security.
Recently, President Donald Trump ordered an investigation into possible tariffs on copper imports. These tariffs might help U.S. mining by making domestic copper cheaper. But they could also increase costs for EVs and renewable energy.
U.S. Faces a Critical Minerals Challenge
S&P Global found that the U.S. has major challenges in securing critical minerals. Robert Friedland, founder of Ivanhoe Mines, warned that depending on foreign sources puts the country in a “dangerous position.”
At CERAWeek, he noted that Wall Street’s focus on quick profits is driving investments away from mining. Developing a new mine takes decades, but only a few have been built lately.
Friedland also suggested a U.S. sovereign wealth fund for domestic mining. This would be like the funds China and Japan have.
Top mining leaders, such as Elias Scafidas from Rio Tinto, say Western companies struggle with long-term funding. Investors hesitate to back mining projects. This is mainly because these projects take too long to become profitable.
Rising Copper Demand Exposes U.S. Supply Gaps
According to the National Mining Association, China controls the supply of 30 out of 44 key minerals. In 2024, the U.S. depended entirely on imports for 12 of the 50 minerals designated as critical in the government’s 2022 list. It also relied on foreign sources for more than half of another 28 minerals.
- As per USGS, In 2024, the copper production of U.S. mine production was an estimated
1.1 million tons, a decrease of 3% from that in 2023. Arizona accounted for ~ 70% of domestic output. Copper was also mined in Michigan, Missouri, Montana, Nevada, New Mexico, and Utah.
The Center for Strategic and International Studies (CSIS) highlights that the global push for net-zero emissions by 2050 is set to double copper demand by 2035. The key force would be AI-driven demand.
- AI data centers alone are expected to consume up to 200,000 metric tons of copper per year from 2025 to 2028, potentially creating a 2.6-million-metric-ton shortfall by 2030.
BHP projects copper demand will grow by 2.6% annually through 2035, surpassing 50 million metric tons per year by 2050. This outpaces the 1.9% annual growth seen between 2006 and 2021.
S&P Global also revealed that to boost domestic production, the U.S. Department of Energy recently announced $500 million in funding for mining and processing. However, experts believe this is far from enough. Without major changes, the U.S. risks falling further behind in securing its mineral supply.
Despite soaring demand, the copper supply chain faces major obstacles. Labor shortages, strict environmental regulations, and rising costs are slowing production. Experts warn that without faster permitting and increased investment, the U.S. could struggle to secure its mineral supply chains.
Freeport-McMoRan Pushes for Critical Status to Boost U.S. Copper
Amid this copper conundrum, Arizona-based Freeport-McMoRan Inc, a leading global metals company aims to have copper labeled as a critical mineral.
CEO Kathleen Quirk said at the CERAWeek by S&P Global conference,
“Having the incentives and clarity around those would be a big plus for the domestic copper industry. People are understanding more what copper is used for and its importance in our economy. It’s just a matter of time before it’s classified as a critical mineral.”
She also highlighted that this move could unlock $500 million yearly in tax credits under the Inflation Reduction Act.
Notably, Freeport reported a 3.1% drop in fourth-quarter earnings, falling to $5.72 billion due to lower copper and gold production. The revenue decline highlights ongoing supply issues and market uncertainty in the U.S.
To stay competitive, Freeport is pushing for policy changes to strengthen its global position. The company plans to boost U.S. copper production. This includes developing the Lone Star mine in Arizona that could add 100,000 metric tons each year.
Resource Nationalism and Global Trade Tensions
Countries rich in minerals like cobalt, lithium, and copper are gaining control over their resources. In the past five years, 47 countries have made mining rules stricter. This includes 17 major producers.
According to the Resource Nationalism Index, the number of high-risk countries has jumped from 22 in 2016 to 38 today. Chile and Peru supply 35% of the world’s copper. Recently, they increased government involvement, which creates uncertainty for miners.
Copper Production by Country 2025
Resource control is also fueling global tensions. The U.S.-China trade war has grown stronger. China is now limiting exports of gallium, germanium, and antimony. In response, the U.S. is ramping up domestic mining and even considering resource acquisitions like Greenland.
Meanwhile, the European Union is working to reduce its dependence on China. It recently passed the Critical Raw Materials Act to boost local production and recycling of key minerals. As global alliances shift, securing critical minerals has never been more important.
Can the U.S. Sustain?
Goldman Sachs predicts U.S. copper imports could surge by 50% to 100% in the coming months as buyers rush to secure supply ahead of potential tariffs.
Currently, the May 2025 U.S. copper price is trading at $756 per metric ton above the global benchmark on the London Metal Exchange (LME). This increase follows Trump’s. investigation into potential tariffs aimed at boosting domestic copper production.
The expects a 25% import tax by the end of the year, a move backed by Trump. If that happens, copper imports could jump, adding 200,000 to 300,000 metric tons to U.S. stockpiles by the third quarter.
- Currently, the U.S. reserves have 95,000 metric tons, but they could grow to 300,000-400,000 tons of copper inventories by the end of the year. It could account for half of the world’s available supply.
Meanwhile, experts warn of a global copper shortage of 180,000 metric tons in 2025. This is due to growing demand for electrification, China’s economic boost, and slow mine production.
Copper is More Critical than Ever
Copper is more critical than ever, but securing enough remains a challenge. The U.S. Geological Survey lists lithium, nickel, and 48 other minerals as critical.
The Energy Act of 2020 highlights copper’s role in every defined use of a critical mineral. It is essential for national security, powering industries from AI data centers to military operations.
Copper prices and global supply are already under pressure. Tariffs and mineral policies will shape the future. With the growing demand for clean energy and AI, a stable supply is more important than ever. However, as U.S. import reliance keeps rising, and much of the world’s copper production is concentrated in geopolitically sensitive regions
Thus, adding copper to the 2025 Critical Minerals list would help. It would drive green energy investment, cut energy costs, and strengthen U.S. industries. Lastly, companies like Freeport are only supporting a strong domestic copper supply.
