Strikes, Bad Weather Push Copper Prices Higher
Striking copper miners at Freeport Indonesia’s Grasberg mine and heavy snowfall in northern Chile are limiting output and pushing copper prices higher. On July 7, copper climbed to $9,550/metric ton ($4.34/lb). The union representing the Grasberg miners plans to extend its strike that began on July 4th, through July 18th. A labor contract was set to expire at the end of September and the miners are seeking wage increases. The company has said, according to Reuters, shipments of copper concentrate have not been affected so far. But analysts say the longer the dispute lasts the more likely Freeport is to declare force majeure. This strike highlights the acute pressure multi-national miners face during a period of high commodity prices. Recently, the Collahuasi copper mine was reportedly operating under a contingency plan due to bad weather. Unusually bad weather in the Atacama Desert also hurt copper production during the first quarter. Reuters reported snow, rain and heavy winds had forced the mine operator to suspend any staff from moving in or out of the pit.