The transition to a lower-carbon economy will not dent demand for commodities, according to the head of the world’s biggest mining company. In his keynote address to the FT Commodities Global Summit in Lausanne, Andrew Mackenzie, the chief executive of BHP Billiton, said it was wrong to think renewable energy would reduce the world’s total consumption of raw materials.

“Some people believe that renewable energy will reduce the world’s total commodity demand, I disagree,” Mr Mackenzie told delegates.

“China, the world’s largest consumer of commodities is also on track to become the global leader in clean energy technology. And renewable energy infrastructure will generate greater demand for commodities. Wind turbines, for example, are copper and steel intensive. And electric vehicles require copper for components and the electricity grid that powers them,” he said, according to Financial Times.

Mr Mackenzie said the electrification and decarbonization would also drive demand for higher quality raw materials as steel mills and copper smelters transition to more efficient technology.

“Structural premiums will emerge for higher quality iron ore, metallurgical coal and copper concentrates,” he said.

Mr Mackenzie said population growth in the developing world and growth of an urban middle class would be the biggest driver of “demand for energy, metals and fertilizers for decades to come”.

“Some forecasts predict the world will need to spend $3.7tn annually to develop and upgrade its infrastructure. If we look at China’s Belt and Road Initiative, demand for steel is expected to increase by an additional 150m tones over the next decade,” he said.