Chile’s Codelco resumes shipments but faces nationwide strike on Tuesday
Copper climbed 1.2% to $3.383 a pound in New York on Monday morning, the highest price in almost a month, as several investors bought the red metal to close out bets on lower prices before mining workers in Chile, the world’s No. 1 producer, announce they will begin their strike tomorrow.
Unions representing more than 25,000 workers at state-owned Codelco, and other firms including BHP Billiton (ASX, NYSE:BHP) and Anglo American (LON:AAL), said they will strike for a day, beginning at 5 a.m. local time Tuesday (10 a.m. GMT), at every Codelco division and at all the large-scale private mines for 24 hours.
According to Prensa Latina (in Spanish), the Chilean miner resumed shipments of copper on Saturday following the end of a port strike that slammed Codelco’s exports, which hindered an estimated 9,000 tonnes of the commodity’s shipments per day.
The strike comes against a backdrop of a presidential election year and it may heavily weigh on the results.
The South American country generates about a third of the world's copper and its stable economy is largely built around minerals exports of minerals. The red metal alone accounts for nearly a third of government revenue.
Mining also provides most of the nation's poor their best shot at a middle-class life, especially in the rural and rugged desert areas of northern Chile, where the majority of mines are located.
Copper prices also rose Monday due to speculation about more Federal Reserve asset buying, or quantitative easing, after figures released April 5 that the US added way less jobs in March than anticipated by analysts.
The commodity fell to an eight-month low of $7,331 a tonne on the London Metal Exchange last week, 28% lower than a record high in 2011. However, almost all copper mines remain profitable at current prices, leading some to speculate that prices could fall further.
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