Copper producers add to mine disruption fear

Bloomberg

The world’s two largest copper producers are giving metal markets even more reason to fear supply disruptions that have helped send prices to the highest in a year.
Peru, the second-largest copper miner, is taking longer than expected to ramp up mines after a two-month lockdown as workers fall ill, a top official said. At the same time, workers at two mines in No. 1 producer Chile are voting on whether to strike over wages.
A slower-than-expected return to full production in Peru and the possibility of labour disruptions in Chile add to supply concerns that have helped fuel a rally in copper prices and are leading some analysts to predict a market deficit this year. Chilean mines that account for a quarter of global output have shelved non-essential activities in a bid to maintain output as Covid-19 cases grow. Copper futures headed for a 5% weekly gain in London.
“The combination of these events in these two key jurisdictions are certainly supportive for copper prices in the short term,” said BTG Pactual analyst Cesar Perez. “Supply risks are growing.”
In Peru, mines were expected to be almost back at pre-pandemic levels by the end of this month but that forecast is now looking too optimistic, Energy & Mines Minister Susana Vilca told reporters.
Mines are finding a number of infected workers when they arrive to start a new shift, she said.