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Consistency in policies coupled with dialogue among players in the mining industry has sustained Chile’s reputation as the global top copper producer, which if emulated, Zambia can compete as world’s leader too, an expert says.
Chile accounts for 80 percent (lion’s share) of the global copper production, recording a high 5,700,000 tons by 2013, according to the United States Geological Survey data-making that country the top notch producer by quantity.
However, inspite of Chile’s reputation, there are still several other countries with significant operations, including neighboring Peru, as well as China, the United States and Russia that have shown resilience, according to the latest compilation of the top 10 countries in the world.
Mining engineer and consultant, Osvaldo Bascur, who has been attached to the Chile mining industry over the years is impressed with Zambia’s zeal to remain among the top rated countries globally and the country has potential to develop if various fundamentals are taken into account.
On the sidelines of the just ended fourth Zambia International Mining and Energy Conference in Lusaka held from 24-25 June, Bascur noted that effective coordination among players in the industry coupled with consistence in policy formulation, reliable power supply to the mines and good taxation policies are cardinal in ensuring that the country achieves returns from the country’s lifeblood.
“Chile is not unique……..Government has shown keen interest in growing the industry that is why the country is leading the chart ……but it’s not only copper but other minerals too,”
Earlier World Bank country resident representative in Zambia, Malawi and Zimbabwe, Kundhavi Kadiresan lauded Chile for its ‘unmatched’ contribution of the red metal to the global metal market of which Zambia should to take a leaf as one of the measures to scale down on external borrowing.
Zambia’s external debt has swelled over US$4 billion, with the country’s import cover around four months, according to data from the Zambian treasury,.
However, Chile’s mine production hit a record 5,700,000 tons produced last year, up from 5,430,000 tons recorded two years ago. Copper is Chile’s mainstay, representing 20 percent of the country’s Gross Domestic Product. It accounts for 60 percent of the country’s exports.
With help from copper revenue, the country’s economy is expanding threefold recording six percent annually; it also credits the industry with the country’s low rates of inflation and curbs unemployment, the US journal adds.
China is rated second- globally with 1,650,000 tons mines last year-less than half of Chile’s outturn. China’s output rose from 1,530,000 tons in 2012 produced by the world’s largest consumer of the red metal, although new production sites are abound which will see the far East Asian state compete with Chile.
Additionally, importing raw copper concentrate to China is costly, causing domestic smelting operations to begin to rise. Peru, is rated third in the world with outturn of 1,300,000 produced last year, though not moved much from that recorded in 2012, the US journal adds.
However Peru’s mine production, according to data, could rise as much as 10 percent in 2014, with that country’s energy and mines minister, Jorge Merino, projecting a 17-percent increase in copper production alone as the result of several new projects set to open in the year ahead.
With prospects abound, Peru expects more foreign investment into its mining sector as a result of these projects. The United States, another emerging force in the production of the red metal is rated fourth having mined 1,220,000 tons last year up slightly from its figure of 1,170,000 tons in 2012, according to MINING.Com.
This increase came despite a catastrophic landslide at Utah’s Bingham Canyon mine in early 2013; the incident which caused it to cease production for an extended period of time. The total copper production in the US is worth more than $1 billion.
Australia is rated fifth with levels estimated at 990,000 tons produced last year, marking an increase from 958,000 tons in 2012, according to Geoscience Australia, a government agency.
Most of the copper resources in the country are located in Queensland and South Australia, though there are resources in each state and in the Northern Territory as well. Most of the country’s production is centered in the Mount Isa region in Queensland and the Olympic Dam mine in South Australia, the agency adds.
Russia is rated sixth at 930,000 tons outturn last year up from the 883,000 tons it produced in 2012, according to NASDAQ. Russia has about 10 percent of the world’s copper reserves, and that the deposits are located primarily in Siberia and the Urals.
The vast majority of Russian copper projects are in remote regions, away from population and infrastructure, which makes mining operations relatively difficult. Additionally, the country has laws restricting the amount of foreign investment in its mineral reserves.
Inspite of the civil strife afflicting the 42 million populated and Africa’s mineral endowed Democratic Republic of the Congo; the country is rated seventh after hoisting 900,000 tons last year, a significant rise from the 600,000 tons produced in the country in 2012.
The International Monetary Fund believes this level of production may spur the country’s economic growth to the tune of 8.7 percent in 2014, reports from Bloomberg news say. In 2012, the mining industry comprised more than 15 percent of the Congo’s gross domestic product, the news outlet notes.
Zambia is eighth at 830,000 tons last year, rising from 690,000 tons a year earlier. However, last year saw the emerging of several new copper projects begin in Zambia, which in turn boosted production of the red metal by 21 percent in the first 11 months of the year, The Wall Street Journal can attest.
“We are at a level where most copper projects that have been in the pipeline a few years back are coming on stream,” Fredrick Bantubonse, an independent metals analyst based in Zambia, told the Journal.
Canada is ninth with output of 630,000 tons recorded last year, up from 579,000 tons recorded a year earlier, according to compilations by Natural Resources of Canada.
It however, notes that copper volume and value both increased despite decreases in the metal’s price throughout the year. This is chiefly on account of a rise to new mine openings by Glencore Xstrata (LSE:GLEN) and Hudbay Minerals (TSX:HBM).
Mexico is 10th with 480,000 tons, a slight increase from that of 2012 which accounted for 440,000 tones. Mexico forecasts increases in copper production over the next two years, according to Bloomberg news, although copper prices on the global metal market will be major determinants for that to occur.
