In this column, Aldo Barreto—Founding Partner & Co-CEO of Unilink—reflects on how the new copper cycle is redefining mining supply priorities, shifting the focus from cost efficiency to operational continuity and the actual availability of critical materials. 

With more than 13 years leading Unilink and a previous career spanning 11 years at SAP Ariba and Quadrem, Aldo brings an expert perspective on the evolution of procurement in mining, in a scenario where production pressure and demand volatility require more resilient, agile, and service-oriented supply models. 

A different structural environment for the copper industry 

The copper industry is operating in an environment that shows structural signs different from those observed in the last decade.

The energy transition, the electrification of the economy, the growth of electricity grids, and the development of electric mobility are driving sustained demand for this metal. Projections from international organizations such as the International Energy Agency (IEA) indicate that global copper consumption could grow significantly by 2040 in energy transition scenarios.

At the same time, supply growth faces significant constraints. Lower ore grades, greater operational complexity, stricter environmental requirements, and long development times for new projects limit the pace of production expansion.

Analysis by the International Copper Study Group (ICSG) and market reports agree that the balance between supply and demand could remain tight over the next few years.

At the local level in Chile, Cochilco forecasts copper prices at historically high levels for the period 2026–2027, reflecting a favorable business environment, but also one that is more demanding from an operational standpoint.

The most significant impact of this scenario is not only seen in the market.

It can be observed directly during the operation.

The real cost of stock shortages 

In contexts of high prices or high margins, the value of each ton produced increases significantly. As a result, the opportunity cost associated with an operational shutdown increases.

In this environment, the main risk to supply is no longer the price of spare parts or service.

The critical risk is a stock shortage of highly critical materials.

The unavailability of a critical spare part can compromise operational continuity and generate losses that far exceed any savings obtained through price negotiations or cost reduction strategies.

Under these conditions, the priority of supply begins to shift from optimizing unit cost to protecting the availability of critical materials.

Greater demands on inventory and planning 

As operations ramp up to capture the value of the cycle, planning models and inventory levels face additional pressure:

• The actual consumption of spare parts and components tends to increase.
• Safety stock is being used up faster than expected.
• Increases the likelihood of breakage in low-rotation materials
• Requirements arise outside the historical demand pattern
• Planned replenishment does not always occur within the expected time frame.

In this scenario, maintaining inventory service levels—understood as the probability of material availability in the warehouse at the time of request—becomes more challenging.

Operational variability does not decrease.

On the contrary, it tends to increase.

The new challenge: ensuring real availability 

Traditionally, supply maturity has been assessed using indicators such as:

• Percentage of expenditure under contract
• Price reduction
• Standardization of suppliers
• Efficiency of the purchasing process

While these elements remain relevant, in an environment of greater operational demands, an additional dimension emerges: the ability to maintain the level of material service when planned replenishment does not occur as expected.

The real challenge is no longer just to correctly size inventory, but to have mechanisms in place that allow for:

• Preventing breaks in critical materials
• Reduce replenishment times in the event of unforeseen circumstances
• Finding alternatives when your usual supplier is out of stock
• Respond quickly when actual demand deviates from the plan

In this context, procurement performance is not measured solely by how much it saves, but also by its ability to protect operational continuity through the effective availability of materials.

Preparing for a more demanding environment 

The new context for copper does not eliminate the need for efficiency.

But it significantly increases the value of availability.

In high-production cycles, the main operational risk is not the cost of inventory, but rather the impact that a shortage of critical materials can have on the continuity of operations.

Preparing for this environment means recognizing that variability is part of the system and that supply resilience will be a key factor in sustaining the service levels defined by materials engineering.

Sources and references 

• Chilean Copper Commission (Cochilco). Copper Market Trends Report and Price Projections for 2026–2027.

• International Energy Agency (IEA). Global Critical Minerals Outlook 

• International Copper Study Group(ICSG)