Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Glencore (LON: GLEN) has resumed operations at its vast Antapaccay copper mine in Peru, which remained shut for 11 days on security concerns following violent attacks by locals.
The mine closed on January 20 after the third attack on the site in a month. The company reopened the operation on January 31 with “increased security” after some of the protests waned, a spokesman for the miner and commodities giant said.
Antapaccay is one of Peru’s largest mines, producing nearly 136,000 tonnes of copper between January and November 2022.
Peru, the world’s No. 2 copper producer, has been gripped this year by rising political and social unrest triggered by the destitution of President Pedro Castillo late last year.
The wave of intermittently violent demonstrations has already imperilled 30% of its copper output and could choke off access to almost $4 billion worth of the metal.
Data from Peru’s ombudsman’s office shows that 58 people have been killed and 1,792 injured in protests since December 7, when Congress removed Castillo, the country’s second Indigenous president, and arrested him.
Protesters have demanded either Castillo’s reinstatement or new elections, which are options experts believe are unlikely to come to fruition.
“As civil unrest fuels disruption, we expect shipments from Peru, which also produces significant volumes of zinc, tin and silver, to be impacted over the coming months, and congress shows no sign of calling a general election in the immediate future,” commodities analyst for BMO Capital Markets, Colin Hamilton, wrote earlier this month.
Besides political reasons, the current unrest is Peru is being fuelled by longstanding grievances about high poverty levels and discrimination felt by many in Peru’s Andean and Amazonian regions.
The country’s south is rich in copper, but locals say the benefits of mining don’t reach the communities who live close to the many operations.
