Half of all copper mines are at risk of drought due to climate change

As the price of wiring metals rises to a two-year high due to predictions of all copper needed for the transition to clean energy, a new report highlights risks to future metal supplies due to climate change.

According to PricewaterhouseCoopers LLP's report, even with an optimistic low emissions scenario in 2050, more than half of the world's copper mines are in regions exposed to significant, high, and extreme risk of drought.

With lithium and cobalt, the other two energy transition metals, the study found that exposure to drought was even higher at 74%.

As mines struggle to meet rising demand from electric vehicles, grid infrastructure, and data centers, copper prices have risen in recent months and are above $10,000 per ton, fueled by bets on imminent shortages.

Mining new deposits is becoming increasingly difficult and expensive, and increased monitoring of environmental and social issues is also hindering investment.

Climate-related disruptions will further increase supply risks. The effects of rising temperatures and changing weather patterns on agricultural products have been widely recorded, but the effects on minerals are less well known.

Copper mines in Zambia face tight power supply due to disruptions in hydroelectric power generation facilities due to the drought.

In Chile, the industry has invested in the use of seawater in recent years, so copper production has been curtailed due to water shortages.

For each of the nine items surveyed by PwC, at least 40% of the world supply is produced in 3 countries or less. In the case of copper, Chile, Peru, and China account for more than half of production.

PwC UK's global climate leader Emma Cox said in an interview, “In other words, if climate change is disrupted, there is a possibility that it will have a disproportionate impact because its spread has not yet spread.”

“I don't think everyone understands the dependencies and impacts of future climate change.”