Goldman Sachs saw growing electric vehicles (EV) use a “key pillar of copper’s bullish story” and predicted that the sector would require 1 million tonnes (mt) of copper this year and 1.5 mt in 2025.
“Due to copper’s highly conductive and ductile nature, it is an ideal candidate for transformation and transmission of electrical energy in EVs,” the bank said in a note dated on Wednesday.
Roughly two-thirds of the growth in global copper demand last year was linked to EV production. Goldman Sachs forecasts that EVs will account for roughly 27% of increased copper use over the next decade.
In the second quarter, London Metal Exchange (LME) benchmark copper prices fell 7.5% due to weak Chinese demand recovery and global growth concerns.
However, Goldman Sachs predicts that copper consumption would decrease in EVs over the long run, with the amount of copper needed per EV expected to drop to 65 kg per unit by 2030 from 73 kg in 2022.
