Chasing the lost copper: Global scrap and its role in decarbonization

Because of a sharp increase in copper demand and a slowdown in primary supply growth, we expect the supply of refined copper to fall about 3.6 Mt short of estimated demand through 2035.

From 2025 to 2035, global demand for refined copper is expected to grow from 29.5 Mt to 37.3 Mt, a rate of about 2.4 percent per annum. This growth will be propelled by an expansion of transportation and electrical infrastructure in critical markets, including China, Western Europe, and North America.

Higher copper prices may encourage mines to further increase supply, which could reduce the emerging deficit. The supply of copper from mines is expected to increase from 23.9 Mt in 2025 to 24.8 Mt in 2035 as new mines ramp up production, counteracting operational declines and closures. We expect further development in existing mining sites to represent two-thirds of these new additions. In addition, the amount of collected and recovered copper postconsumer scrap is expected to increase from 5.6 Mt to 8.9 Mt by 2035 (mainly propelled by growth in postconsumer scrap generation). However, this increase will not be able to fully make up for the supply deficit in our base-case scenario and will require a further build-out of secondary-smelting capacity to use all available postconsumer copper scrap generated. In fact, current projections of scrap processing capacities for 2035 suggest a processing gap of more than one million metric tons.

In the context of a supply deficit for copper, scrap can be used as an alternative, low-carbon feedstock to produce refined copper in four ways:

1. Direct melt of preconsumer scrap. Scrap from manufacturing processes has a known composition and few impurities. Therefore, it can be directly reused, with no re-refinement required.
2. Direct melt of postconsumer scrap. The highest-purity, uncontaminated postconsumer scrap (such as busbars) can be directly processed into semifinished copper products such as wires and tubes.
3. Indirect melt of higher-quality postconsumer scrap. Higher-quality scrap from products that have reached the end of their life cycles can be re-refined to raise the purity levels of refined copper.
4. Indirect melt of lower-quality postconsumer scrap. Nonalloyed postconsumer scrap of lower quality requires resmelting to remove impurities. This scrap is also used to regulate smelter temperature.

Because scrap has already been mined and processed, using it instead of primary copper can reduce a final product’s carbon intensity. About two-thirds of CO₂ emissions in the copper value chain are concentrated at the mine site, where minerals are mined and processed. Mining activities account for about 27 percent of total value chain emissions, and mineral processing accounts for about 40 percent. More than half (about 51 percent) of emissions specific to mine sites are attributed to purchased electricity (Scope 2 emissions). Together, smelting and refining copper make up more than one-quarter of total value chain emissions (about 27 percent), and transportation accounts for the remaining 6 percent.

The global average CO₂ intensity for refined copper from secondary-only material is 0.6 metric tons of CO₂ per metric ton (tCO₂ per t), compared with between 2.9 and 3.7 tCO₂ per t for refined copper derived predominantly from ores. As a result, circularity through the increased use of secondary copper (especially as direct melt) represents one of the largest and easiest methods to achieve decarbonization.

The volume of postconsumer copper scrap has risen steadily over the past four decades. It is expected to continue to grow by about 4 percent per annum from 2020 to 2050, reaching a total of approximately 14 Mt by 2050.

The increased use of scrap is driven by several factors:

• As more copper is consumed, the availability of scrap increases.
• More consumers and governments have promoted a circular economy, which has increased collection rates of scrap.
• There has been an increased awareness of the carbon emissions produced by primary pyrometallurgy and an effort to lower the overall CO₂ footprint per t of refined metal.

Currently, the average postconsumer content of refined copper supply is about 20 percent, whereas the copper scrap used in refined-copper production represents about 45 percent of the estimated copper volumes contained in all products that currently reach end of life.

Although postconsumer scrap volumes are growing, about 40 percent (7.8 Mt) of the anticipated total scrap pool is not expected to enter the official recycling value chain by 2035.

Scrap can be uncollected because of longer-than-expected product lifetimes. For example, vehicles have an estimated lifetime of 17 years but can last longer than that. In addition, it is often uneconomical to collect scrap before it enters landfills because of labor costs. Furthermore, in developing markets, a large portion of scrap does not enter the formal recycling ecosystem. Copper from these sources is not accessible to global companies that require quality control and traceability.

The majority of products that are not collected through either formal or informal channels are disposed in landfills or incinerated. A smaller share, especially in consumer goods, is hibernated and not disposed.

By addressing uncollected postconsumer scrap, producers could recover up to four to five Mt of additional copper supply by 2035.

Untapped value pools of postconsumer copper scrap can be found across regions and sectors. Of the pools available, three are particularly promising:

1. Consumer goods in North America. Large volumes of e-waste and low-grade material in consumer goods are not collected and end up in landfills. To increase the treatment of e-waste, stakeholders need to establish and expand recycling systems to improve recovery of e-waste and divert low-grade material from landfills. Public awareness campaigns could support collection efforts, as could creating waste collection or return programs through partnerships between consumer goods companies and upstream companies. Collection could also be supported by introducing systems for extended producer responsibility (EPR) and stronger e-waste regulation in critical US states. In addition, the absence of economic incentives to recycle low-grade e-waste and secondary-smelting infrastructure discourage collection. Regulatory incentives or higher copper prices may be required for at-scale, downstream secondary-smelting capacities to grow and to improve the business case for lower-grade e-waste recycling in future.
2. Formalization of collection across sectors in emerging regions such as India, Latin America, or Other Asia.¹“Other Asia” includes Indonesia, Thailand, and Vietnam. In emerging regions, global companies lack access to a large system of informal scrap collection channels. By formalizing collection processes with regulatory support and the development of collection infrastructure, global organizations could begin to gain access to these pools. For example, regulations aimed at increasing recognition, registration, and tracking of formal scrap collection activities, paired with incentives for employment in formal (rather than informal) collection, could stimulate the formalization of collection streams. Partnerships (for example, between nongovernmental organizations and multinational corporations) could accelerate the joint buildup of needed formal infrastructure, such as training and equipment.
3. Improved consumer goods collection in emerging regions. As in the United States, copper in emerging regions (India, Latin America, and Other Asia, for example) often ends up in landfills in the form of e-waste and consumer goods. Likewise, increasing recycling awareness and introducing systematic recycling channels could help improve scrap collection. These measures could include the introduction of EPR schemes, regulatory enforcement of e-waste recycling, and subsidies for formal streams. For example, e-waste regulations in India have successfully improved collection rates. As other regions have done, emerging regions could introduce return programs to facilitate the disposal of consumer electronics and household appliances or consider regulatory incentives for the build-out of collection infrastructure such as collection points and downstream smelting.

In addition to these three areas, companies can look into increasing their existing share of collected scrap supply, although this area has already largely been explored.

Stakeholders around the world are making a strong and increasing push toward circular products. To meet their needs, companies across the copper value chain are building circularity capabilities in three key ways:

1. Mitigating supply risk through procurement. Players are cooperating across the value chain to secure secondary feedstock through long-term supply contracts, partnerships, and “closed loop,” or circular, agreements. They are also securing their supply by investigating uncollected scrap pools that are not entering the official recycling value chain.
2. Meeting decarbonization targets through innovation. Copper companies are looking into technology that can help them capture more value from scrap. Some companies are building technology through proprietary R&D, and others are partnering with companies in the industry to increase the ratio of copper scrap intake in smelters (for example, through hybrid smelting), the efficiency of intermediate scrap product processing, and the metal recovery rate of lower-grade postconsumer scrap. Companies are also building circular business models to decrease the need for raw materials within the value chain. For example, smelters are testing the use of hydrogen in the production process.
3. Achieving circularity objectives through investment and M&A. Companies are making capital expenditure investments to increase scrap processing capacity and lower emissions. For example, many copper refiners are switching to renewable energy. Companies are also making M&A investments in critical secondary-materials organizations, focusing on organic or inorganic growth to enlarge recycling capacity, increase existing secondary smelting or build new secondary smelters from scratch, and increase the value chain footprint through vertical integration.