Across the copper value chain, companies are setting ambitious targets to reach carbon neutrality in the next decade. This push for decarbonization coincides with increasing demand for copper—driven by the metal’s significance in future-facing applications such as batteries, renewable energy, and electricity transmission and distribution—as well as restricted supply. In fact, the world is expected to face a refined-copper shortfall of about 3.6 million metric tons (Mt) by 2035, according to McKinsey analysis.
Copper recycling could be the key to solving the supply challenge. Increasing the capture of secondary copper (that is, postconsumer copper scrap such as e-waste) would open new supply sources and eliminate emissions from producing primary copper. This should go hand in hand with a further build-out of secondary-copper smelting capacity. It could also enable a more secure copper supply in the future. All in all, developing circular value chains for copper will take a strong push from producers to secure and increase secondary-copper volumes and a strong pull from OEMs and end consumers who value recycling and decarbonization.
This article is part of a series on increasing the circularity of materials. To access the growing (and partly uncollected) scrap pool, copper producers should consider partnerships and investments in the copper scrap collection and processing value chain. As these secondary-copper value chains develop, there will likely be greater competition to secure postconsumer scrap volumes, making it critical to be more proactive.
Challenges to increase copper scrap volumes
The copper value chain relies on two types of inputs: copper ore from mines (that is, primary copper) and scrap. Preconsumer scrap is recovered from the manufacturing process, and postconsumer scrap is recovered from products at end of life. Both ore and scrap can be refined to make copper that is usable in other products. Because refined copper is a commodity, it is less differentiated than the wide variety of plastics, glass types, or even steel types. Recycling copper scrap is thus in some ways simpler than recycling other materials. However, companies looking to introduce new circular supply and decarbonize refined copper supply chains face three main challenges:
- Limited scrap supply. Approximately 60 percent of postconsumer copper scrap will enter the formal recycling value chain globally in 2035; the remainder is either lost, collected informally, or uncollected (for example, if it is possible to recover but difficult to access). Accounting for processing losses, the share of formally recycled and reused copper units further reduces to about 45 percent of the total copper content of postconsumer scrap.
- Mixed end products. Copper is often only a partial component in a given end product, meaning it needs to be extracted or separated from anything that has been recycled. Impurities in collected copper mean that scrap volumes may need to be re-refined or downcycled.
- Sourcing. It is difficult to track the provenance of copper scrap across geographies and end sectors.
These challenges vary by region but generally hold true across the global copper industry. The first step in improving circularity and reducing mine-based emissions is to raise awareness of the full copper value chain so that stakeholders can take informed action.
Global demand for copper is expected to exceed supply by 2035, increasing the need for scrap
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.
Optimizing the copper recycling value chain would bolster supply
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:
- 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.
- 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.
- 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.
- 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.
As a low-carbon feedstock, copper scrap is a key catalyst for decarbonization
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.
Postconsumer copper scrap use is expected to grow approximately 4 percent per annum through 2050
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.
The uncollected-scrap pool provides a key pathway to increase circular copper volumes
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.
Three opportunities to tap into uncollected copper scrap stand out
Untapped value pools of postconsumer copper scrap can be found across regions and sectors. Of the pools available, three are particularly promising:
- 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.
- Formalization of collection across sectors in emerging regions such as India, Latin America, or
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