|The data above is based on two estimates:
How much copper each EV will consume in the future, and
How many EVs will be on the road in the future.
For the future per-vehicle copper requirements:
Robert Friedland estimated 359 pounds per vehicle,
BHP claims EVs will require 288 pounds each,
Katusa Research is predicting 211 pounds per EV, and
Glencore estimates 206 pounds per car.
If Robert Friedland’s high forecast is correct… more than 20 billion pounds of copper will be required in 2040 just to meet the copper demand for EVs.
That is about 40% of today’s total copper demand.
Now naturally, Friedland is going to promote an extremely bullish scenario.
But, even the always-conservative Katusa model indicates that by the end of this decade, EVs will consume 4.2 billion pounds of copper per year.
The problem is that this demand is 1.5x greater than the annual production of the world’s largest and most productive copper mine, Escondida.
The world can’t supply that much copper at the current price of less than USD$2.50 per pound. It’s just not economically feasible.
It’ll require at least $3.50+ copper.
BHP (the world’s largest mining company) predicts that copper will go above $5/pound.
Friedland is expecting even higher. He thinks copper will rise to $8/pound.
In short, it doesn’t matter who you believe. Even Tesla issued a public warning last year of a coming copper shortage.
All four scenarios above show that copper is going a lot higher.
And if our recent Vancouver Resource Investment Conference is any indication, NO ONE is talking copper stocks right now.
Which is exactly why we should be paying attention.
The only certainty in this market is that investors in companies that own large, high-quality copper deposits in mining-friendly jurisdictions will be happy.
Because if Friedland is right, you’ll need a telescope to see the share price of those companies.
Remember, the increase in demand for copper from EVs is only half of the story.
Supply is the other half of ‘supply and demand’.
And even though demand for copper is healthier than ever… copper supply is struggling.
Click here for the next article on the coming Copper Crunch. And how the global copper supply is going to have trouble keeping up with the EV revolution.