Discovered a place containing a giant 'red treasure' many times larger than an underground mine, which can be recycled infinitely

One of the world's largest mining companies is digging through America's drawers, old phones and landfills for valuable 'red gold': copper flakes that could help meet the demands of the energy transition.

Shredded cellphones, computer cables and crushed old cars are piled 30 feet high outside Glencore's 97-year-old copper smelter, deep in a sparsely populated forest in northern Canada. There, scrap is melted down and copper is concentrated to produce new metal sheets.

Old electronics have become an input for smelters. Now, Glencore and other copper producers are expanding their scrap collection to increase recycling capacity.

The accelerated shift from fossil fuels to renewable electricity promises to reshape commodity markets. If the U.S. needs less crude oil and coal, it will need more lithium for electric vehicle batteries and power poles. And copper is essential in everything that involves electricity.

'In the next 25 years, we will consume more copper than humanity has ever consumed , ' said Kunal Sinha, Glencore's director of recycling .

Old electronic equipment has become input for the smelter.

Copper demand has skyrocketed in recent decades as China has pushed to modernize. Laws promoting renewable energy in the U.S. have also boosted demand for the red metal. Data centers being built to support artificial intelligence (AI) also require copper. And so do smartphones.

Glencore estimates that global copper supply must increase by about 1 million tonnes a year until 2050. That would require annual additions equivalent to the world's largest mine, Chile's Escondida.

Value of scrap

Even when large deposits of copper are found, it takes decades to bring mines of the metal into production. That prevents miners from catching up with new demand, leaving the market looking for scrap, said Citigroup strategist Tom Mulqueen.

Unlike oil or food, copper is infinitely recyclable. A lot of copper is sitting in scrap yards and landfills. As prices rise, recyclers will have more incentive to buy it back. Copper prices are at an all-time high.

However, demand could be affected by a sluggish Chinese economy, slowing manufacturing or a stalled energy transition.

Unlike oil or food, copper is infinitely recyclable.

Nearly half of demand will be recycled copper by 2050 , up from about a third now, according to estimates from energy data firm Wood Mackenzie. Much of America's scrap is shipped to Asia, but copper producers are building up recycling capacity in North America.

German company Wieland has begun construction on a $100 million recycling facility in Shelbyville, Illinois, in 2022. The company is continuing negotiations with the Department of Energy for an additional $270 million in funding to expand the facility.

Another German company, Aurubis, is building an $800 million recycling facility in Augusta, Georgia. A spokesperson said the company has already started sourcing scrap and expects to be producing copper next year.

Global Search

Glencore traders in Toronto, Switzerland and New York are tasked with finding scrap. Materials from some 40 countries are brought to Rouyn-Noranda and shipped to Glencore. There is even a dumpster at the smelter entrance, where the surrounding 42,000 residents can collect old electrical wiring and broken appliances.

The company also looks at auto scrapyards. Useful parts and metals are removed from cars before they are shredded. Glencore has found that the amount of copper in auto scrapyards can be twice as high as the amount of copper in geological deposits.

 The amount of copper in auto landfills can be twice as high as that in geological deposits.

The scrap piled up in Quebec is further shredded and fed into a 1,200-degree-Celsius furnace. Finally, the molten metal is cooled and sent to Glencore's Montreal refinery, where it is re-smelted to collect other metals such as platinum, palladium, silver and gold.