Chile plans $100 billion copper push to find buyers beyond China

Chile is eyeing about $100 billion in copper investments over the next decade as it seeks to tap demand from data centers and diversify its customer base beyond China, according to its top diplomat.

“It’s highly concentrated and we need to expand the number of places that are buying copper from us,” Chilean Foreign Affairs Minister Francisco Pérez Mackenna said at Bloomberg’s Sustainable Business Summit in Singapore on Wednesday.

To do that, Chile needs to invest heavily so it can move away from exporting concentrate and instead start shipping refined copper, he said.

“Probably China will continue to be a very significant client for our copper because of the industrial footprint they have,” Pérez Mackenna said but noted that demand for the metal should become even more widespread with the race to build data centers around the world.

The effort comes as countries rush to secure supplies of the metal which is a critical input in everything from power grids, electric vehicles and, recently, the data centers powering the global artificial-intelligence boom.

Separately, Chile has begun negotiating a free trade agreement with India and will strengthen existing deals with its neighbors as part of a broader effort to reach more export markets, Pérez Mackenna said.

China has for years been the biggest buyer of Chilean copper, taking more than half of the country’s exports of the metal. But negotiations over annual supply contracts have become more difficult in recent years as mine disruptions constrained global supplies while a rapid expansion of China’s smelting industry heightened competition for copper concentrate.

The changing market has already prompted Chilean producer Antofagasta Plc to propose linking annual copper concentrate contracts to spot-market indexes instead of fixed treatment and refining charges, challenging a pricing system that has underpinned the industry for decades.

(By Srinidhi Ragavendran)