In “The Craman Countdown,” Pacer ETF President Sean O’Hara explains why copper and other critical metals are becoming essential fuels for AI, data centers, and next-generation electronics.
Amazon’s The push to build large artificial intelligence data centers is also expanding to Arizona, where recently reopened copper mines are providing industrial metals that are increasingly sought after to power Big Tech’s AI infrastructure.
On Thursday, wall street journal Amazon Web Services (AWS) has reportedly signed a two-year agreement with mining giant Rio Tinto’s Newton operation to secure copper supplies related to its expanding AI data centers.
The Arizona mine outside Tucson (the Johnson Camp mine, which used Rio Tinto’s Newton bioleaching technology) restarted operations last year, becoming one of the first new sources of copper production in the United States in more than a decade. The contract covers approximately 14,000 tonnes of copper cathodes over four years.
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“We’re working at the product level to find low-carbon solutions to drive business growth,” Chris Roe, Amazon’s worldwide carbon director, told the Journal. “It means steel, it means concrete, and when it comes to data centers, it absolutely means copper.”
A bundle of copper cathode sheets at the Hydromat plant at the Freeport-McMoRan open-pit copper mine complex in Morenci, Arizona, Thursday, Sept. 19, 2024. (Getty Images)
According to the Copper Development Association, the average data center uses approximately 5,000 to 15,000 tons of copper, but the largest facilities can require tens of thousands of additional tons for wiring, transformers, circuit boards, and power systems.
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Still, this supply is only a fraction of the copper needed for a single copper supply. large data centerhighlighting how large the overall copper demand for AI infrastructure is becoming.
Amazon said it is targeting low-carbon materials throughout its supply chain. The copper will be supplied to manufacturers who make components for AWS data centers, and AWS will provide cloud computing and data analytics support to help Rio Tinto optimize production and recovery of Nuton’s copper.
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“It’s not just the fact that we’re processing ore that wouldn’t otherwise be economical to process, but also that we’re doing it with lower carbon and lower water intensity,” Katie Jackson, CEO of Rio’s copper business, told the Journal. “It’s great to have customers who see that as part of their value proposition.”
Last year, copper prices near record levelwith benchmark prices above about $6 per pound amid growing global supply concerns as demand grows.
