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Copper price down as BHP and workers reach tentative wage deal at Escondida

BHP’s Escondida copper mine in Chile. (Image: Wikimedia Commons)

BHP and the union at its Escondida copper mine in Chile said on Tuesday that they had reached a tentative deal for a new contract, although the union will take two more days to submit the new contract to a vote by workers.

The preliminary deal eases fears that the union will call a strike at the world’s biggest copper mine.

Escondida is expected to produce 1.01-1.06 million tonnes of copper in the 2021 financial year. The figure is equivalent to over 5% of the world’s annual mined copper output.

In 2017, a historic 44-day work stoppage jolted copper markets and slowed economic growth in Chile, the world’s top copper producer.

Copper top mines

Copper prices fell on Wednesday after the deal was announced.

Click here for an interactive chart of copper prices

Three-month copper on the London Metal Exchange eased 0.4% to $9,485.50 a tonne by 0316 GMT, while the most-traded September copper contract on the Shanghai Futures Exchange tracked overnight gains in London to rise 0.8% to 69,810 yuan ($10,770.82) a tonne.

Copper price LME

A deal at Escondida would also ease labor tensions in Chile after workers at the Caserones mine owned by JX Nippon Mining & Metals opted to walk off the job Tuesday when their talks with management collapsed.

(With files from Reuters and Bloomberg)