India, Mongolia in talks for preliminary mining pact
The pact will focus on transit of minerals such as coal and copper, Reuters sources say.
The Democratic Republic of Congo has imposed a 48-hour lockdown in Haut-Katanga, a key copper-cobalt-producing province after two people tested positive for the coronavirus on a flight from the national capital Kinshasa to Lubumbashi, the provincial capital.
The measure, effective Sunday, is expected to weigh heavily on copper output, said Indigo Ellis, head of Africa Research at global risk consultancy Verisk Maplecroft.
“The greatest risk to copper output from DR Congo is the potential for smelter or logistics-related bottlenecks, preventing mines from shipping concentrates,” Ellis said.
Congo is Africa’s main copper producer and the world’s no. 1 miner of cobalt, a key component in electric car batteries
Ivanhoe Mines and MMG Ltd are among the mining companies with concessions in Haut-Katanga.
Neighbouring Lualaba province, home to mines owned by Glencore and China Molybdenum, ordered all public markets to close on Monday except those selling food and medicine.
“As the world economy grapples with the impacts of Covid-19, it is becoming increasingly unlikely that DRC will manage to qualify for the International Monetary Fund (IMF) programme in April 2020, particularly in the face of falling copper demand,” Ellis noted.
Ellis referred to a financial assistance package agreed on last year, which would allow the IMF to resume lending to Congo for the first time since 2012.
The loan scheme is expected to be a boon for mining, Ellis said, as it will improve transparency and accountability, dictating that all licences must be published online.
Congo is Africa’s main copper producer and the world’s no. 1 miner of cobalt, a key component in electric car batteries. But it is one of the world’s least developed countries.
The news comes as copper concentrate treatment charges (TCs) continue to decline as a result of supply disruptions at key copper producers, such as Chile, Peru and now the DRC.
According to SMM Metal Price’s estimates, TCs for imported copper concentrate spot trade in China came in at $68.35 per tonne last Friday, down $3.12/tonne from a one-year peak of $71.47/tonne the prior week.
Fears of supply shortages have stemmed from announcements last week by several Chilean and Peruvian copper producers that they will reduce or suspend operations as their respective governments declare a state of emergency aimed at containing the spread of Covid-19.
Projects impacted include Anglo American’s Los Bronces and Quellaveco as well as MMG’s Las Bambas and Freeport-McMoRan’s Cerro Verde.
Chile’s state miner Codelco, the world’s no.1 copper producer, has also scaled down operations. On Monday, the company sent a letter to all its staff noting that the drop in copper prices has put some of its projects “at risk.”
With files from Reuters.
