Supply disruptions may be starting to have an impact on prices, according to the International Copper Study Group which recently reported a 53 000 t global deficit in April, up from a 18 000 t shortfall in March.
A six-week strike at BHP Billiton’s Escondida mine and lower production from Codelco operations contributed to a 12% decline in production in Chile, the world’s largest copper producer, in the first four-months of the year. This contributed to a 3.5% decline in world mine supply in the first four months of 2017, according to the ICSG.
With usage down around 3% in the same period, however, the copper market reported an overall refined surplus of around 80 000 t for January-April, up from a 185 000 t deficit in the same period of 2016.
Additionally, recent production problems may have had a more limited impact on global copper supply.
According to Peru’s Ministry of Energy and Mines, only around 4000 out of 65 000 workers participated in nationwide strikes in the country. Peru is the world’s third-largest copper producer after Chile and China. And although 5000 miners at Indonesia’s Grasberg mine have decided to extend their strike for a fourth month until the end of August, the operators Freeport have said it has had no serious effect on production.