There are three major components of the mining supply chain: exploration, mining, and processing. Across this chain, from mine to market, a range of different countries, companies, and jurisdictions must play a role. 

One of the results of this is a highly variable supply chain more acutely impacted by price fluctuations, geopolitical crises, and natural disasters. Therefore, it has historically been more difficult for mining companies to have a comprehensive management system of integrated end-to-end processes. 

Covid-19 laid bare the vulnerabilities of this system, as demand for commodities such as copper, iron ore, and zinc dropped significantly. As a result, mining companies have had to reassess the resilience of their organisation and global supply chain models. 

One of the most explicit instances of this fragmented supply chain is in the copper industry. Copper has a very narrow supply base, with 65% of documented copper resources in just five countries: Chile, Australia, Peru, Mexico, and the US. 

The narrow supply base is also reflected in copper’s processing. China is the leading importer and exporter of refined copper and home to 9 of the 20 biggest copper smelters in the world. With such a narrow supply and processing base, if one major supplier gets disrupted, the whole chain suffers. This was the case in 2021 when numerous community strikes led to operations at the Las Bambas mine in Peru stopping for several months.  

With copper only becoming more critical to support the upscaling of green energy, several solutions exist to remedying its fragmented supply chain. 

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Firstly, mining companies could shift towards a customer-centric supply chain, using data and technology to facilitate a more efficient and profitable way of business. They also need to support recycling and repurpose projects to alleviate the pressure on the supply chain, widening the supply base of the metal. 

The mining supply chain 

Mining supply chains are highly complex and account for all mining assets, including equipment, processing plants, and railway and port operations. Further complicating matters is the wide range of processes required to bring copper from the mine to the market and the separate interdependent steps within each activity before the products reach consumers. 

Presently, the mining supply chain operates within organisational silos, business divisions that operate independently and avoid sharing information. This means that the supply chain has limited coordination and data exchange, making it highly fragmented and not part of an integrated process. 

As a result, the supply chain is prone to disruptions from economic, political, and natural forces. The stakes have risen significantly over recent years, as geopolitical uncertainty and changing demand for critical minerals has led to more and more key deposits being targeted in tougher jurisdictions


Nowhere is this more apparent than when examining the copper supply chain. Copper is highly abundant and found in a free metallic state in nature. However, it has a highly uneven distribution, requiring certain geological conditions. This uneven distribution has led to a minimal supply base, with only a small number of producing countries. Peru for instance, accounts for 40% of mined copper, meaning if one major producer suffers, the entire supply chain suffers. 

However, within these major producers, the grade of the ores has been on a steady decline. When analysing copper mines, the average ore grade has decreased approximately 25% in just 10 years. In that same period, the total energy consumption has increased at a higher rate than production (a 46% energy increase over a 30% production increase). 

From 1991 to 2015, global extraction has doubled, rising from 9.3 million tonnes to 18.7 million tonnes, leading to fears over the future availability of copper, with several studies estimating that global copper peak production will occur between eight and 40 years from now. 

Declining grades, a very narrow supply base, and dwindling recoverable assets pose significant risks to the copper supply chain, compounded further by labour negotiations and blockades. There is now a projected shortage in copper supply relative to demand through 2025, with the shortfall reaching as much as 290,000 tonnes. 


Following extraction, copper must go through a lengthy process to be viable for industrial and commercial use. The processing of copper encompasses a range of steps, including unit processes for sizing, separating, and processing minerals such as comminution, sizing, separation, dewatering, and hydrometallurgical or chemical processing. 

Like its mining base however, the processing of copper is limited in scope and the Covid-19 pandemic exposed the frailties of this system when leading smelters began to question whether they could maintain output, leading copper prices to reach an all-time high. Subsequently, Chinese imports of copper concentrate dropped by 1.9% year on year to 21.76 million tonnes in 2020, the first decline in imports since 2011. 

These supply constraints are at odds with increased copper demand, spurred largely by the green energy transition, including accelerating the growth of electric vehicles and charging systems in the automotive industry. Demand for “green copper” is only expected to grow over the next 10 years, with estimations that the rise in demand could increase by as much as 13% year on year. 

Supercharging the supply chain 

A range of solutions exists to alleviate the pressure on the supply chain. Firstly, stakeholders can explore the deployment of data-driven analytics and artificial intelligence, allowing companies to pinpoint which customers represent the most significant revenue potential for the least cost and prioritise serving those targets. Doing so will reflect shorter cycle times, more on-time deliveries, and reduced need for expediting. 

The development of a circular supply chain is also a viable option. Given the supply of primary copper is determined by mine output and smelter and refining capacity, the upscaling of refined copper from high-grade scrap and secondary refining capacity could provide a secondary stream of copper into the market. 

Moving away from the traditional, linear ‘make, use, dispose’ economy to the circular economy would require increased reuse, remanufacturing, recycling, and increased material efficiency.   

However, given that copper is a 100% recyclable metal, with 80% of mined copper still in use, the supply of recyclable copper is only expected to increase. Countries such as Japan and China have made excellent progress in creating a circular copper supply chain. However, this progress is seemingly localised, and it will become necessary to improve the quality of communication processes – to search for new, standard solutions.