Copper's Looming Deficit: A 10-Million-Ton Shortfall by 2035

Edward Lawson

Remarks of Officials

Economic

Commodity

Summary:

The global copper industry anticipates a structural deficit by 2030, with soaring demand from AI and green tech clashing with declining ore grades, prompting urgent strategic shifts.

The global copper industry is on a collision course with a "structural deficit" between 2030 and 2035, requiring a massive ramp-up in production to meet skyrocketing demand. That’s the stark warning from Brandon Craig, president of BHP Americas.

According to Craig, the market needs an additional 10 million tons of copper between now and 2035. This means the industry must boost output by roughly 40% above current levels within the next decade alone.

This pressure is already reflected in the market. In January, copper prices hit a record high, with the London benchmark price approaching $13,000 per ton—a 40% increase from a year prior and a 60% jump from five years ago.

Surging Demand from China to AI Data Centers

The demand side of the copper equation is fueled by both traditional and emerging sectors. China, which consumes 60% of the world's copper, remains a key driver. While its residential sector has softened, Craig noted that demand is being sustained by a strategic push into advanced manufacturing.

"The underlying demand is being driven by other parts of the economy, principally manufacturing, and that continues to be really positive for copper," he explained, pointing to China's growth in electric vehicles and renewable energy projects.

At the same time, a new and powerful demand driver is emerging: the rapid expansion of data centers for artificial intelligence. Copper is essential for these facilities, used in everything from wiring and semiconductors to critical cooling systems.

While this digital segment is still in its early stages, its growth potential is enormous. According to BHP's analysis:

• Traditional Uses: Power cables and infrastructure still account for 92% of copper demand.

• Energy Transition: Green energy technologies make up 7%.

• Digital Infrastructure: Data centers and AI currently represent just 1%.

"It's currently a relatively small share of the market," Craig stated. "If you project forward sort of 10 or 15 years, it'll progressively become a more and more material impact."

The Supply-Side Bottleneck

While demand accelerates, miners face significant hurdles in increasing supply. A primary challenge is the declining quality of existing copper deposits. As mines age, the ore grade—the concentration of copper within the rock—naturally falls. Over the past three decades, the average ore grade has dropped by approximately 40%, making it harder and more resource-intensive to extract the same amount of metal.

The International Energy Agency (IEA) echoed these concerns last year, warning that without sufficient action, copper supply could fall 30% short of what's needed by 2035. "This will be a major challenge," IEA Executive Director Fatih Birol said. "It's time to sound the alarm."

BHP's Strategy: Tech, Investment, and Acquisitions

In response, major producers like BHP, the world's largest mining company by market cap, are deploying a multi-pronged strategy focused on technology, investment, and strategic acquisitions.

Boosting Efficiency with AI

At the Escondida project in Chile, the world's largest copper mine, BHP has successfully used technology to increase production by nearly 30% over the last three years. Craig emphasized that artificial intelligence and machine learning are central to this effort.

By analyzing real-time data from ore concentrators, AI helps optimize processing and improve copper recovery rates. It also identifies materials that could damage crushing equipment before they cause downtime, directly boosting productivity. "What's really important is you have choices in terms of how you operate the mine," said Craig, noting that AI helps "offset some of the constraints" impacting the industry.

Growth Through New and Existing Projects

BHP has also aggressively pursued growth by acquiring copper assets, including Australian miner Oz Minerals and Canadian-listed Filo Corp. The company also attempted to acquire London-based Anglo American in 2024 and 2025.

Alongside acquisitions, Craig highlighted the importance of investing in existing projects, such as Escondida, Resolution in Arizona, Kitlanya in Botswana, and Olympic Dam in South Australia. "For those companies like us who have world-class resource positions, we can absolutely invest into organic projects that are very competitive," he said.

Geopolitical Risks and the Path Forward

The copper market is not immune to geopolitical turbulence. Market volatility has been fueled by speculation over potential U.S. tariffs, while China's dominance in refined copper production creates potential supply chain vulnerabilities.

However, Craig believes the long-term fundamentals will ultimately outweigh short-term political shifts. The key, he argued, is building a more resilient and efficient global supply chain.

"The politics will change over time," he concluded. "But the fundamental demand and supply of copper is ultimately going to be determined by how efficiently we can connect mines, smelting, refining capacity and end use."

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James Riley

Economic

Remarks of Officials

Commodity

Political

Russia-Ukraine Conflict

China–U.S. Trade War

France's aerospace industry leaders are issuing a stark warning about the "weaponization" of global supply chains, highlighting how geopolitical rivalries are turning critical materials into strategic leverage. Olivier Andries, president of the French aerospace association GIFAS and CEO of engine maker Safran, flagged rare earths as a major vulnerability in the ongoing tensions between the US and China.

China's Grip on Rare Earths Poses Geopolitical Threat

The core of the industry's concern lies in its dependency on China, which supplies 90% of its rare earth needs. Andries explained that the trend of using critical supply dependencies for geopolitical advantage is growing, putting aerospace in a precarious position.

While the sector has mostly dodged direct hits from the US-led tariff conflicts due to the deeply integrated supply chains of giants like Airbus and Boeing, the availability of specialized minerals remains a significant worry. These materials are essential, found in small but critical quantities in advanced products like modern jet engines.

The problem extends beyond mere supply quantity. Andries noted that Chinese authorities are asking "intrusive" questions about the final destination of these materials, a tactic he compared to the extra-territorial playbook developed by the United States. He stressed that this issue is significant enough to require a coordinated response at the European level.

Navigating European Defense Projects and Politics

Beyond global supply chains, Andries also pointed to domestic and intra-European challenges. He expressed concern over the lack of a French domestic budget for 2026, stating that parliamentarians had "lost direction." French Prime Minister Sebastien Lecornu is currently attempting to pass the budget following the use of emergency legislation.

For now, France's defense spending remains on track, buoyed by increased European military investment in response to the conflict in Ukraine and political pressure from the US.

However, major collaborative projects face hurdles. Regarding the Franco-German-Spanish Future Combat Air System (FCAS) fighter project, Andries acknowledged a "very strong political will" from the leaders of France and Germany. But he cautioned that progress hinges on industrial cooperation, stating, "you also need to have agreements and the manufacturers accepting to work together." This comes amid friction between key players Airbus and Dassault Aviation, with Dassault criticizing Germany's decision to purchase US-made F-35 fighter jets alongside its commitment to European programs.

US Actions Reinforce Need for European Sovereignty

Recent geopolitical moves by the United States are further fueling Europe's drive for strategic autonomy. Citing former President Donald Trump's renewed threats to take over Greenland, Andries argued that such statements amplify the debate over relying on foreign military hardware.

"These rather uninhibited messages only increase the growing awareness in Europe that while we are of course partners and allies of the United States, we have to cultivate our own sovereignty and not totally entrust our future to another state," Andries told reporters. The dispute over the Danish territory has alarmed NATO allies, gaining new urgency after Trump's actions against Venezuelan leader Nicolas Maduro.

Ultimately, Andries urged French suppliers to invest strategically in the coming years. He emphasized the need to prepare for both rising European defense expenditures and the development of next-generation commercial airliners, positioning the industry to expand its role in both sectors.

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Gerik

Commodity

U.S. Seizure of Venezuelan Oil Triggers Tensions With Beijing

The Trump administration’s aggressive move to seize control of Venezuela’s oil sector has introduced a new geopolitical complication: how to navigate China’s deep financial and strategic entanglements in the country. With President Nicolás Maduro removed from power and U.S. companies preparing to step into Venezuela’s energy vacuum, Washington must now contend with China’s existing claims both legal and economic that stem from decades of oil-backed loans and infrastructure investments.

Between 2000 and 2023, China extended approximately $106 billion in loans to Venezuela, making it the fourth-largest recipient of Chinese official lending globally. Much of this debt was structured as loans-for-oil agreements, with Caracas repaying in crude shipments. However, estimates of Venezuela’s outstanding debt to China vary widely. While some suggest $10 billion remains, researchers at AidData caution the actual figure could be much higher due to a lack of reporting and the disruption of oil flows from U.S. sanctions in recent years.

Chinese Oil Interests Now in Limbo

China’s commercial interests in Venezuela are considerable. According to Morgan Stanley, state-owned giants CNPC and Sinopec hold entitlements to roughly 4.4 billion barrels of oil reserves more than any other foreign power. In addition to energy, Chinese firms have invested in Venezuela’s telecommunications, ports, and railway sectors, signaling long-term intent to secure influence in Latin America. However, the ouster of Maduro has upended this strategy.

The U.S. has begun redirecting Venezuela’s crude for sale on the open market, stating that proceeds will go into U.S.-controlled accounts intended to benefit the Venezuelan people. Chevron, the only U.S. major still authorized to operate in the country, is ramping up exports. Meanwhile, trading houses like Vitol and Trafigura have secured provisional U.S. Treasury licenses to handle Venezuelan oil, potentially displacing Chinese refiners who had relied on discounted crude amid sanctions.

Causal Friction Between Strategic Aims and Trade Stability

The unfolding scenario represents a potential point of friction between two competing aims of the Trump administration: asserting strategic dominance in the Western Hemisphere while preserving a fragile trade détente with China. Trump is expected to visit Beijing in April to reinforce that truce. Analysts suggest that the administration is unlikely to let Venezuela derail broader trade priorities. As Craig Singleton from the Foundation for Defense of Democracies put it, the U.S. may apply pressure carefully, avoiding a “flashpoint” that jeopardizes ongoing negotiations with China.

Nevertheless, the causal impact of U.S. actions in Venezuela could be significant. By undermining Beijing’s investments and ignoring Chinese oil rights, Washington risks fueling a deeper strategic rivalry. This reflects a deliberate shift in U.S. policy: reducing adversarial influence in Latin America, a cornerstone of Trump’s national security doctrine.

Beijing’s Legal and Diplomatic Response

China’s official response was swift and critical. After Maduro’s capture, the Chinese Foreign Ministry expressed “deep shock” and “strong condemnation” of what it labeled an illegal U.S. intervention. Spokesperson He Yadong insisted that economic cooperation between China and Venezuela is protected by international law and should not be impeded. However, analysts argue that China’s ability to influence outcomes in the region is limited. While Beijing may lodge diplomatic protests, it lacks the military and economic leverage to defend its interests once Washington acts unilaterally.

The memory of Libya looms large in Beijing. After Moammar Gadhafi’s fall in 2011, Chinese businesses lost billions in investments. Venezuela now risks becoming a similar case. The interim government could choose to reclassify agreements made under Maduro as invalid or illegitimate, opening the door for U.S. firms to claim priority over Venezuela’s future oil profits.

A Strategic Realignment in the Hemisphere

Venezuela is currently China’s only “strategic partner” in Latin America, a status shared with a select few countries like Pakistan. The collapse of the Maduro regime and the U.S. occupation of Venezuela’s oil assets represents a significant contraction of Chinese influence in the Western Hemisphere. For the U.S., this marks a victory in the geopolitical contest for regional dominance.

Still, Beijing is unlikely to retreat entirely. China’s energy security no longer depends heavily on Venezuelan crude, having diversified supply sources and increased investment in electrification. Its losses in Venezuela, while symbolic, may not cripple its global energy strategy.

President Trump’s takeover of Venezuela’s oil sector poses a complex diplomatic test with China. While Washington tightens its grip on the Western Hemisphere’s energy resources, it risks undermining its delicate trade ceasefire with Beijing. The coming months will test whether the administration can assert geopolitical control without triggering deeper conflict with its primary economic rival or whether Venezuela becomes the next front in a widening U.S.-China contest.

Source: AP

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Gerik

Commodity

Economic

Geopolitical Risks Support Oil Price Upside

Oil markets continued upward momentum as traders priced in heightened uncertainty over crude supply linked to geopolitical developments involving Iran and Venezuela. Unrest in Iran, including civil protests and potential disruptions to output, has contributed to fears of constrained exports from one of OPEC’s key producers. Concurrently, U.S. actions against Venezuela’s government and moves to exert influence over the South American nation’s oil exports have introduced further ambiguity about future supply flows. These factors have underpinned recent increases in both Brent and West Texas Intermediate crude futures, with prices poised for a weekly advance following notable gains in recent sessions.

Market dynamics have been significantly shaped by the evolving situation in Venezuela, where U.S. forces intervened and attempts are underway to bring the country’s oil sector under American influence. Traders are interpreting these developments as both a risk premium on potential supply disruptions and a reallocation of future crude flows. Major energy firms and trading houses are reported to be engaging with the U.S. government to explore opportunities in Venezuelan oil exports, potentially shifting the traditional flow of crude away from buyers such as China. Although Venezuela’s production has historically been well below its vast proven reserves due to chronic underinvestment, speculation about enhanced output under new arrangements has influenced prices.

Complex Balance Between Risk Premiums and Oversupply

Despite the upward pressure from geopolitical risk, analysts caution that structural factors continue to limit sustained price rallies. Global oil markets are grappling with oversupply conditions, supported by high inventories and production from multiple regions. Expectations that Venezuela could eventually increase its output remain tempered by the significant investment and time required to rehabilitate its aging infrastructure. In this context, the recent price uptick reflects a mix of risk‑related premia rather than a decisive shift in the fundamental supply‑demand balance.

The recent gains in oil prices demonstrate how geopolitical tension correlates with short‑term market sentiment, especially when linked to supply risks in major crude‑producing nations. However, the longer‑term trajectory will depend on whether disruptions materialize or if policy moves lead to greater actual output. Traders remain attentive to further news from both the Middle East and Venezuela, with prices sensitive to developments that could either tighten or ease perceptions of global supply constraints.

Oil’s recent rally underscores how external political events can influence investor expectations and commodity pricing, even in markets characterized by abundant supply. While geopolitical risks have supported price gains, fundamental factors such as global inventory levels and production capacity continue to temper long‑term bullish sentiment.

Source: Bloomberg

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King Ten

Economic

Daily News

Remarks of Officials

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U.S. President Donald Trump has indicated that Venezuelan opposition leader Maria Corina Machado is expected in Washington next week, a significant development following U.S. strikes that resulted in the capture of President Nicolas Maduro.

Venezuelan opposition leader Maria Corina Machado is expected in Washington following the capture of Nicolas Maduro.

During a Fox News interview, Trump confirmed his awareness of her potential visit. "Well, I understand she's coming in next week sometime, and I look forward to saying hello to her," he stated.

The White House has not yet provided additional details on a potential meeting. This would mark the first encounter between Trump and Machado, who won the Nobel Peace Prize in October and said earlier this week she had not spoken with the U.S. leader since then.

Uncertainty Over Venezuela's Future Governance

The political future of the South American nation remains a key question. The planned meeting comes after Trump dismissed the idea of working with Machado over the weekend, claiming "she doesn't have the support within or the respect within the country."

With interim acting President Delcy Rodriguez currently leading the country, Trump suggested that Venezuela is not yet prepared to hold elections.

"We have to rebuild the country. They couldn't have an election," Trump told Fox News. "They wouldn't even know how to have an election right now."

Rebuilding Venezuela's Oil Industry a Top Priority

As an OPEC member and a major oil producer, Venezuela's energy sector has become a central focus for the Trump administration. A senior official told Reuters that oil sales to the United States will commence immediately, with an initial shipment of 30 million to 50 million barrels. These sales are expected to continue indefinitely.

To facilitate this, President Trump announced he will meet with oil executives at the White House on Friday. He emphasized that these companies will be instrumental in reconstructing Venezuela's oil industry.

"They're going to rebuild the whole oil infrastructure," Trump said. "They're going to spend at least $100 billion and it's an unbelievable oil that they have, and an unbelievable quality of oil and amount of oil."

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Justin

Stocks

Hoa Phat Agriculture Development JSC raised about 1.257 trillion dong ($48 million) in its initial public offering after receiving more bids than shares it offered.

The unit of Hoa Phat Group — Vietnam's largest steelmaker — sold 30 million shares at the IPO, according to a statement on its website. The winning price for the share sale was 41,900 dong per share. The company had received bids for about 35.7 million shares, prompting it to set a pro rata allocation in which each investor received 83.94% of the shares they registered to purchase, the statement said.

After the share sale, the company's charter capital increased to 2.85 trillion dong from 2.55 trillion dong, it said in the statement.

The IPO of Hoa Phat Agriculture adds to a wave of recent Vietnam initial public offerings. In September, Techcom Securities, a unit of Vietnam Technological and Commercial Joint-Stock Bank, raised about $410 million from its initial public offering while VPBank Securities raised about $482 million in its IPO in November.

The benchmark VN Index surged about 41% last year, boosting investor appetite and encouraging more companies to tap into the equity market for capital. The gauge has risen about 4% so far in the first week of 2026.

At the IPO price of 41,900 dong per share, Hoa Phat Agriculture expects a dividend yield of about 9.2% in the next 12 months, including the remaining dividend for 2025 and the interim dividend for 2026, according to the statement. It plans to maintain a minimum dividend of 3,000 dong per share per year in 2026-2030 period, or a dividend yield of about 7.2% per year.

By 2030, the company targets revenue to exceed 12 trillion dong and after-tax profit to reach about 1.75 trillion dong. It's revenue and profit were at about 7 trillion dong and 1 trillion dong, respectively, in 2024, according to the statement.

Source: Bloomberg Europe

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Dark Current

Economic

Russia-Ukraine Conflict

Energy

Remarks of Officials

Commodity

Political

Data Interpretation

Middle East Situation

Oil prices extended a strong rebound on Friday as traders focused on escalating geopolitical tensions in Russia and Iran, which could threaten global crude supplies.

Brent oil futures for March delivery climbed 0.7% to $62.44 a barrel, while West Texas Intermediate (WTI) crude futures also rose 0.7% to $58.03 a barrel. The gains followed a rally of over 4% for both benchmarks on Thursday, erasing recent losses and returning prices to levels seen before last week's U.S. military action in Venezuela.

Adding a tailwind to the market, positive inflation data from China, the world's top oil importer, suggested that its economic recovery is gaining momentum. However, gains were capped as investors remained cautious ahead of key U.S. nonfarm payrolls data, a report that will likely influence the future path of interest rates.

Geopolitical Risks from Russia and Iran Drive Prices

Concerns over potential supply disruptions from two major producers, Russia and Iran, provided significant support for crude oil prices this week.

Russia-Ukraine Conflict Fuels Supply Concerns

The ongoing military conflict between Russia and Ukraine continues with little sign of a ceasefire. Market anxiety intensified after a drone attack on a Russian-bound tanker in the Black Sea, sparking fears of wider disruptions to Russian crude exports.

Adding to the pressure, reports this week indicated that U.S. President Donald Trump is expected to approve a bipartisan bill that would impose even stricter sanctions on countries doing business with Russia. This move is part of a continued effort to compel Moscow to agree to a ceasefire.

Separately, Iraq's government approved a plan to nationalize operations at the West Qurna 2 oilfield, one of the largest in the world. The move aims to prevent disruptions that could be caused by U.S. sanctions targeting Russia.

Unrest in Iran Adds to Market Uncertainty

In Iran, rapidly spreading anti-government protests have raised concerns about potential interruptions to the nation's oil production. As demonstrations broke out in several major cities against the Nezam, the government responded by enacting a nationwide internet blackout this week.

Venezuelan Supply Shock Fears Subside

Oil prices also found support as market fears of a sudden surge in Venezuelan oil supply began to fade.

Earlier this week, President Trump stated that Caracas would turn over as much as $3 billion in oil to the United States and that Washington intended to control the Latin American country for years. This followed the U.S. capture of Venezuelan President Nicolas Maduro, which initially sent oil prices tumbling.

However, the U.S. Senate voted on Thursday to advance a resolution that would bar the president from taking further military action against Venezuela without congressional approval. Furthermore, a consensus is forming among analysts that a significant increase in Venezuelan output is unlikely in the near term due to heightened political instability and aging oil infrastructure.

By Friday, oil prices had fully recovered from the initial shock. Despite the recent rally, the market is still feeling the effects of its worst yearly drop in five years in 2025, with growing concerns over a potential supply glut in 2026.

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