The Zhitong Finance App learned that Guojin Securities released a research report saying that global copper supply growth is limited, supply disturbances from leading mining companies have intensified, and copper supply and demand have maintained a tight balance. The increase in computing power brought about by generative AI increases long-term copper demand from the supply side (data center) and transmission side (5G base stations). Driven by AI-related application fields, demand for independent development and import substitution of high-end copper alloy materials such as high-end copper sheets and copper foil for electronic circuits for PCBs will continue to rise. It is estimated that in 2024-2026, the global data center +5G base station PCB+GB200NVL72 will reach 89/108/1.29 million tons respectively when copper consumption is high, and will reach 39/50/630,000 tons respectively. The AI wave will bring about long-term growth in downstream copper consumption.

It is recommended to focus on targets such as Zijin Mining (601899.SH), Luoyang Molybdenum (603993.SH), Tongling Nonferrous (000630.SZ), Western Mining (601168.SH), and China Nonferrous Mining (01258).

The main views of Guojin Securities are as follows:

The rapid rise of artificial intelligence computing is driving a rapid rise in copper demand

Intelligent computing in data centers and the 5G transformation of base stations place higher demands on copper materials. AI+ computing power reshapes the basic logic of data processing and transmission. Among them, data centers and base stations support AI+ computing power requirements from both ends of data supply and data transmission, respectively. In this context, intelligent computing in data centers and the 5G transformation of base stations place higher demands on copper materials.

Domestic production capacity is gradually meeting the demand for copper sheets and foils, and high-end products need technological breakthroughs. Copper processing materials used in the AI and 5G fields are mainly copper alloy materials such as copper strips for connectors, copper strips for lead frames, and copper foil for electronic circuits for PCBs. Currently, production capacity in mainland China is gradually meeting the demand of the copper strip and foil market, and net imports are showing a downward trend year by year. However, domestic replacement of high-end copper strips and high-frequency high-speed PCB copper foil used in integrated circuits and other fields is still slow, and high-end copper processing materials still require technological breakthroughs.

Supply side: DC opens a new era of AI, and copper may usher in new opportunities

Demand for copper in data centers is mainly concentrated in power distribution equipment (75%), grounding and interconnection (22%), and pipeline HVAC (3%). (1) The distribution boards and busbars inside data center servers are mainly made of copper materials. AI computing power servers, which mainly use high-power GPU chips, place higher requirements on data center power supply and distribution systems in terms of power demand, power density, and line capacity. (2) In the short-distance interconnection scenario of data centers, copper cables have greater practical value than optical cables. For most data centers, the best solution is to use a mixture of optical cables and copper cables to achieve “go hand in hand” between optical and copper cables. (3) In the future, the refrigeration elasticity of the AIDC pure intelligent calculation type of full liquid cooling system is about 2-4 times that of the current Puzhi integrated form. Among them, cold plate liquid cooling technology uses copper-aluminum heat transfer cold plates to transfer heat to the cooling liquid to achieve heat dissipation.

Nvidia's GB200 super AI chip leads a new chapter in “high-speed copper connectivity”. GB200NVL72 uses a copper cable connection scheme to create additional copper requirements for servers. Guojin Securities estimates that the total amount of copper used in a single GB200NVL72 is about 1.36 tons. GB200NVL72 shipments in 2024-2026 are estimated to be 0.41/6.79/108,700 tons of used copper, respectively.

Demand for copper in data centers and PCBs continues to rise. As data center construction progresses and electricity consumption continues to rise, demand for copper continues to grow. Guojin Securities estimates that global data centers will use about 46-1.12 million tons of copper in 2026. AI and 5G promote the increase in PCB output value and the upgrading of the electronic circuit copper foil industry. It is estimated that in 2026, the amount of copper foil used for PCBs in China and the world will be 35.84/683 million tons, respectively.

Transmission side: The explosive growth of 5G base stations has spawned new demand for copper

Increased demand for copper derived from 5G base station construction. (1) The transmission speed and channel function requirements of 5G base stations have increased dramatically. The mainstream architecture of each macro base station requires 192/384 sets of RF connectors, which is an exponential increase compared to the current mainstream 64 sets. (2) Demand for antennas and RF modules has increased, and demand for high-frequency high-speed PCBs for copper-clad plates and copper foil will become the main 5G copper scenario. According to Guojin Securities estimates, in 2026, China and the world will respectively drive demand for copper PCBs by 36,600 tons. (3) 5G construction promotes the integrated circuit industry and the development of high-end copper alloys for lead frames.

Risk warning: AI data center and 5G infrastructure construction progress falls short of expectations; technological breakthroughs reduce copper demand; there is a difference between estimated copper demand and actual demand.