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Some basic math shows that the coming electric car boom will create a super boom in copper demand. In 2016, EVs made up 1.6% of the total U.S. car market and it is expected that EVs will make up 4% by 2021 and - get this - by 2030, the adoption of EVs in the U.S. will be 34%. What does that mean for copper demand?

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…Using these assumptions, we find that the U.S. automobile sector alone will conservatively consume 1.1 billion pounds of copper in 2030 with the EV sector consuming 360 million pounds of that total (33%) which will increase total U.S. annual copper consumption by just under 9%. That's a lot of copper.

…In 2016, EVs were just 1% of the Chinese market. The Chinese government is planning for 4% EV adoption by 2021, however, and wants…20% by 2025… That means the total consumption of copper in the Chinese vehicle market will be 2.1 billion pounds, of which 700 million pounds (33.3%) will be just EVs.

Combining American and Chinese demand, we get 1.06 billion pounds per year in extra demand. In a 50-billion-pound annual market, that's a 2.1% increase in demand. While 2.1% may not sound like a lot, let's put it into perspective. An annual demand increase of 1.06 billion pounds is more copper than Rio Tinto (the 9th largest copper producer in the world) produced in 2016. To put it another way, there are only four copper mines in the world that annually produce more than 1.06 billion pounds of copper.

I think you get the picture with just the U.S. and China. The rest of the world will follow.

Looking further into the future, some are even more bullish on EV growth. The chart below, published by Bloomberg New Energy Finance, shows that by 2040, the global EV market could get to over 60 million vehicles sold that year alone.

I also haven't mentioned the amount of ?plug in? infrastructure that will be required to meet EV demand. All those EVs need special charging stations. China is heavily investing in new electricity grids; the U.S., under President Trump, plans major infrastructure projects that will all create new demand for copper.

Green energy uses multiple times the amount of copper per unit of energy compared to that of coal and natural gas.

Another major new source of demand for copper will be the smart home. Smart homes use over twice as much copper as traditional homes. Installing solar roofs and all the other features that include the electrification of a smart home will double the use of copper in a house.

I expect EVs will be the driving force behind global copper demand increasing at 4.5% per year for the next 25 years. While this might not seem like much, it's actually enormous demand growth for a mature market. It translates into a nearly three-fold increase in global demand over the next 25 years.

If we believe annual copper demand is set to double over the next 25 years, the next question we have to ask is, ?Can the copper mining industry supply that much?? The answer is ?Yes, but not with copper at $3 per pound!?

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