Peru mine spending at eight-year low signals copper tightening

Cuajone mine. (Image by Southern Copper Peru, Facebook.)

Mining investments in Peru are set to fall to at least an eight-year low next year due to a lack of new copper projects, the head of the country’s industry group SNMPE said on Tuesday.

Expenditure is likely to come in at $3 billion to $3.5 billion next year, said SNMPE President Victor Gobitz, who also heads one of Peru’s largest mines, Antamina. The low investment estimate adds to a recent string of bad economic news for Peru, once the fastest-growing major economy in Latin America, which is now going through a recession.

Given Peru is the No. 2 copper-producing nation and has large untapped deposits, its shrinking near-term project pipeline is part of the reason why analysts are flagging a tightening of the market in the years ahead as the shift away from fossil fuels pushes up demand.

“It’s a negative trend,” Gobitz told reporters in Lima. “But it’s a figure that is still significant.”

Peru’s copper production has largely remained stagnant in recent years. Gobitz said it could reach as high as 2.7 million metric tons this year and 2.8 million tons in 2024.

(By Marcelo Rochabrun)

Related: Peru miners say copper output could climb without impact from protests


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