Copper prices remained supported in February, trading in the ballpark of $6,000 per metric ton as a return to production at two top mines — which are combined responsible for some 8% of global output — looks increasingly doubtful in the near term.
• Escondida Mine
A strike at the Escondida in Chile, the world’s largest copper mine, appeared far from ending during February. The strike increasingly turned more violent as protesters blocked roads and battled police. The events reflect the increasing bitterness and division between the two sides, as positions still appear to be far apart after almost four weeks of strike. Key differences include disagreement over changes to shift patterns and the level of benefits new workers receive.
• Grasberg Mine
Meanwhile, Freeport-McMoran is under a concentrate export ban as it negotiates a new operating license from the government of Indonesia. Having limited storage capacity, the company will be forced to drastically cut output if Indonesia doesn’t give the company an export license to send material to its local smelter for processing.
What This Means For Metal Buyers
Copper prices might look expensive compared to what they were just three months ago, however sentiment in the industrial metals complex remains quite bullish and current supply issues could turn into large deficits if stoppages and disruptions are prolonged. It’s seems early to call for an end on copper’s bull market.
India Nickel Scrap prices drop; Nickel Futures up 1.84 percent, India’s major nickel scrap prices dropped on the Scrap Register Price Index as on Friday, while nickel futures prices at India’s Multi Commodity Exchange gained on the potential for supply disruption from Philippines, the world’s top nickel ore exporter.The Philippines could consider banning exports of unprocessed minerals such as nickel in an effort to promote value addition in the mining sector, a senior environment official said.
“It is one of the options that has to be considered not only by the DENR (Department of Environment and Natural Resources) but by the entire government,” DENR Undersecretary Maria Paz Luna told reporters.
Prices remained supported on the potential for supply disruption from the world’s top nickel ore exporter, but miners said following in the footsteps of neighbouring Indonesia wouldn’t be viable without big government incentives.
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