17:55 23 August 2025
Europe’s Defense Spending Surge to Drive Metals Demand
Rising defense expenditures in Europe are set to boost global demand for industrial metals, according to a new Goldman Sachs analysis. By 2027, additional military spending could increase global demand for steel by 0.4 percent, copper by 0.9 percent, and nickel by as much as 1.3 percent. The shift comes as eurozone defense budgets are expected to grow from 1.9 percent of GDP in 2024 to 2.7 percent in 2027.
Currently, defense accounts for 2–3 percent of global demand for copper, aluminum, steel, and zinc, and around 7 percent for nickel. In Europe, the share is lower than in the U.S., but analysts note that 40 percent of the region’s rising defense budgets will go toward metals-intensive equipment, double NATO’s recommended 20 percent benchmark.
Goldman Sachs estimates this will translate into €18 billion more in European defense spending on metals, adding nearly $9 billion in raw material purchases. Copper is expected to see the strongest impact, with demand growth projected to accelerate to 2.4 percent annually by 2027.
