Copper futures have reached past the $4.20 per pound mark, the highest level in seven months, as the promise of a demand boost from recovering China meets supply chain disturbance arising from the growing unrest in Peru.
Protests in the world’s second largest copper exporter is threatening to choke off access to almost $4 billion worth of copper, as the country faces the worst wave of civil unrest in 20 years.
The South American nation has declared a state of emergency in the capital Lima as well as numerous other regions. Protests erupted following the expulsion and imprisonment of socialist President Pedro Castillo on December 7, who was accused of attempting to organize a coup by dissolving parliament, which was prepared to depose him.
Current President Dina Boluarte, his then-vice president from the same party, succeeded him in accordance with the Constitution. Demonstrators are calling for Boluarte’s resignation and new elections, mainly stemming from Castillo supporters seeing the newly installed president as a “traitor.”
Despite the state of emergency, the unrest descended on the capital city of Lima on Thursday for a significant planned march against the administration and Congress. Many have demanded Boluarte’s resignation as hundreds have traveled to the capital on buses and foot while waving flags and banners denouncing the police and government for deadly violence in the southern cities of Ayacucho and Juliaca.
Human rights organizations claim that the police and soldiers used lethal weapons during the protests. According to the police, the demonstrators have utilized explosives and guns.
Earlier on, Boluarte maintained that she will not stop down despite the increasing conflicts resulting to a growing death toll. Over the last five weeks, at least 42 individuals have reportedly died throughout the country, with a further eight killed in related accidents.
“I will not resign. My commitment is with Peru,” she said in a live televised address on Friday night, adding that she expressed sadness for the deaths that occurred during clashes with security troops, but she insisted on continuing as leader.
The deaths during the protests served as the focal point for a large portion of the outrage, with posters branding Boluarte a “murderer” and referring to the police and military killings as “massacres”.
“We have delinquent ministers, presidents that murder and we live like animals in the middle of so much wealth that they steal from us every day,” said Samuel Acero, a farmer who heads the regional protest committee for the Andean city of Cusco. “We want Dina Boluarte to leave, she lied to us.”
Boluarte has declared her support for a proposal to move the 2026 presidential and congressional elections earlier to 2024. However, a large number of demonstrators claim that no conversation is conceivable with a government that has allegedly used such extreme violence against its people.
Due to anti-government protests that witnessed an attack on the facility last week, the massive Antapaccay copper mine in Peru, owned by Swiss miner Glencore, is currently running at “restricted” capacity.
“The mine has not yet suspended operations, which overall continue in a restricted manner,” the company source told Reuters. “Due to the road blockades, no type of transport activity is being carried out, this includes the transport of concentrate for export.”
Two Antapaccay company trucks were set on fire last week, and there were attacks in the neighborhood where the workers lived. Glencore responded by stating that it will evacuate its 2,400 employees from the area.
“The local protest leaders continue to incite the population and have set themselves the objective of paralyzing the mine,” the person said.
Las Bambas, Peru’s third-largest copper mine and owned by China’s MMG, hasn’t dispatched copper concentrate since January 3 because of safety issues. Together with Antapaccay, the mines, which have the same highway access to ports, produce close to 2% of the copper used in the world.
According to an MMG official on Monday, mining at Las Bambas is taking place at a lower rate than usual, although processing is operating at full capacity. Due to frequent blockades set up by residents wanting greater benefits from the mine’s activities, the mine has decreased its output since late November.
In addition to Peru supply woes, top producer Chile also forecasted its output to contract by nearly 6% in 2023.
Information for this briefing was found via Reuters, Mining.com, Global News, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.