Copper supports Europe’s shift to cleaner energy, including electricity grids, renewable power generation, electric vehicle charging, data centres and industrial electrification. However, the metal is outside the current scope of the European Union’s Carbon Border Adjustment Mechanism (CBAM). European smelters and refineries therefore face EU climate-compliance costs without a direct carbon-border measure, as the bloc seeks to strengthen strategic raw-material supply chains.
EU copper imports rise in value
Eurostat data show that EU copper imports were worth approximately €17.2 billion in 2025, up from €10.7 billion in 2019, while import volumes remained broadly stable. Chile accounted for 23% of the import value, followed by the Democratic Republic of Congo with 17% and Brazil with 15%.
Although copper supplies are relatively diversified compared with those of some other critical materials, Europe remains a major net importer. That dependence makes the competitiveness of domestic smelting and refining increasingly relevant to industrial security. As demand grows for copper-intensive infrastructure, processing raw materials in Europe could help reduce external supply-chain risks.
Processing costs and CBAM coverage
Copper production spans concentrate preparation, smelting, converting and refining, followed by the production of cathode copper. The refined metal is then used to manufacture wire rod, tubes, foil and other industrial products. Each stage has its own energy requirements and emissions profile.
Electricity consumption, fuel use, oxygen production and process chemistry all contribute to copper processing’s environmental impact. European smelters and refineries must account for applicable European Union Emissions Trading System (EU ETS) costs, while managing energy expenses that can affect their competitiveness. Under the current CBAM scope, imported refined copper does not face a direct CBAM charge.
This creates a regulatory asymmetry: European processors can incur carbon-related operating costs while competing with imported refined metal that is not subject to the same direct border mechanism. Copper currently lacks the equivalent carbon-border treatment applied to covered aluminium and selected iron and steel products.
CBAM exclusion and investment in refining
The lack of direct CBAM coverage removes one potential element from the business case for new copper smelting and refining capacity in Europe. Projects may still benefit from strategic status under the Critical Raw Materials Act (CRMA), links to recycling operations, secure concentrate supplies and long-term demand from industrial customers. Traceability and reliable delivery can also support relationships with manufacturers seeking greater supply-chain transparency.
Capital providers cannot assume that European copper production will receive the same carbon-border protection as covered metals. For prospective projects, competitiveness will depend heavily on electricity prices, processing efficiency, feedstock access, financing conditions and the ability to secure long-term offtake agreements.
Low-carbon electricity and advanced processing technologies could lower operating costs and emissions, while recycled copper could provide an additional feedstock source. Those advantages would need to support commercial returns without a CBAM benefit, which does not currently apply to copper.
Demand growth and Europe’s supply security
European copper demand is supported by investment in electricity networks, renewable energy, electric vehicle charging, electrified heating and data centres. These applications require substantial quantities of conductive metal and reinforce copper’s strategic importance. If domestic refining capacity declines while consumption rises, dependence could shift further downstream.
Instead of relying mainly on imported ores or concentrates, European manufacturers could become more dependent on refined copper and semi-fabricated products produced elsewhere. That would complicate efforts to build resilient industrial supply chains and retain more processing value within the European economy. The issue is relevant to the EU’s critical raw-material objectives: access to mineral resources alone does not ensure supply security if processing capacity remains concentrated outside Europe.
Operational options and future CBAM discussions
For European copper producers, immediate routes to stronger competitiveness include efficient processing technology, affordable low-carbon electricity, recycling integration and reliable concentrate supplies. Recycling can reduce reliance on primary feedstock and support circular material flows, although scrap availability and quality affect the contribution secondary copper can make to overall supply.
Long-term offtake agreements with grid operators, renewable energy developers and industrial manufacturers could improve revenue visibility for new processing facilities. For banks and investors, the central question is whether operational and commercial advantages can offset the absence of a direct CBAM mechanism while covering copper refining’s capital and energy requirements.
Copper raises a broader policy question about the relationship between carbon regulation, industrial competitiveness and strategic material security. Europe aims to expand domestic processing, but the current CBAM framework does not cover every energy-intensive metal that supports its industrial transition. Any future expansion would require regulatory decisions on product coverage, emissions accounting and the relationship between border measures and domestic carbon pricing.
European copper smelters and refineries currently compete without the direct CBAM protection available to certain other metals. Whether low-carbon power, recycling, technological improvements and strategic supply agreements can sustain new investment will be central to efforts to strengthen Europe’s copper processing industry. Copper could become an important test case in future discussions about extending EU carbon-border policy beyond its original covered sectors.