Here's the strange thing about the looming copper shortage everyone keeps warning about: it might not actually be a copper shortage at all.
The mining industry has spent years sounding alarms about dwindling discoveries and the urgent need to bring dozens of new mines online. But new research from Benchmark Mineral Intelligence suggests that in the United States, at least, the problem isn't what's buried underground. It's what happens after you dig it up.
Raw Materials Aren't the Issue
According to Benchmark's analysis, the U.S. can cover 146% of its domestic copper demand using a combination of domestic mine output, recycled scrap, and overseas supply. That's a comfortable cushion. Compare that to China, the world's biggest copper consumer, which can only satisfy 40% of its needs domestically and depends heavily on imports of raw materials.
"The U.S. is producing more copper than it uses, and is far more self-reliant than China in terms of raw materials," Benchmark analyst Albert Mackenzie told the Financial Times. The problem, he explained, is "downstream"—the country simply doesn't have enough capacity to smelt and refine raw copper into cathode, the refined form that manufacturers need.
This is a weird bottleneck to have. You've got the stuff. You just can't process it efficiently. Mackenzie's point is that even without controlling overseas mining operations, the U.S. would still have plenty of raw copper thanks to domestic production and scrap. But if you can't turn that raw material into usable metal, you're stuck sending it elsewhere for processing—which defeats the whole point of supply security.
His argument challenges the conventional policy wisdom, which has emphasized securing upstream mining assets and building strategic stockpiles. If your processing capacity is the real constraint, stockpiling raw copper or buying mines abroad doesn't solve much.
