The price of copper, of which Chile is the world’s leading producer, suffered on Thursday its biggest daily fall since March and fell below the barrier of 4 dollars a pound.
Three-month copper on the London Metal Exchange (LME) lost 4.08% on Thursday to $3.98 a pound ($8,775.5 a tonne), the lowest level since April, the Chilean Copper Commission (Cochilco) reported.
The average price of copper in August thus fell back to 4.2 dollars per pound and the annual average to 4.15 dollars, far from the historical maximum reached on May 10 (4.86 dollars per pound) and that surpassed the records of the “supercycle” of 2011.
According to experts, the slowdown in China’s economic growth and the intentions of the US Federal Reserve (Fed) to reduce stimulus by the end of the year would explain the fall in price, as well as the increase in covid-19 contagions in the world by the delta variant.
Chile, which accounts for 28% of the world’s copper production and is discussing the possibility of introducing a royalty on the extraction of the metal, produces around 6 million tonnes per year.
The red metal, fundamental in the transmission of energy, has become the main Chilean product and concentrates almost 50% of exports.
In the country, where there has been a specific tax on mining activities since 2006 that applies to profits and not to exploitation, giants such as BHP, Anglo American, Codelco and Antofagasta Minerals operate, but also infinity of small and medium-sized companies.
