博客 Blog

China fights to secure its global copper supplies

Environmental legislation in South America has made copper harder to come by for China, which now has to take more direct action

Article image

Chinese companies spending billions of dollars in expenditure and refurbishment on mines around the world (Image by Wikipedia)

China has taken new market-based measures to ensure its ever-increasing demand for copper is met. The steps have come at a time when many Chinese companies are purchasing copper mines in Latin America, where increasingly strict environmental protection laws and vocal civil society protest campaigns have halted a number of copper projects in recent years.

Copper is used predominantly in electric cables and construction. In a sign of the mineral’s importance to Chinese growth plans, Mofcom, the Chinese Ministry of Commerce, recently took the unusual step of enforcing strict requirements on a merger between the Anglo-Swiss commodity trading company Glencore and the mining firm Xstrata.

The deal was only cleared by Mofcom in April (like more than 100 other countries, China retains the right to review mergers and acquisitions) after China was offered assurances that it would continue to be able to buy copper from the new combined minerals giant at a reduced price, and after Glencore agreed to sell the Las Bambas copper project in Peru, which could be worth $4bn-$5bn.

It is little wonder that China is so concerned about copper, according to Erik Bethel, partner and co-founder of Sino-Latin Capital. ‘There is a deficiency in copper that borders almost on being a national security issue. China mines domestically 1 million tonnes of refined copper, and it consumes 7 million. And the demand is only going to grow,’ he says.

Much of that growing demand is likely to be met by Latin America, where three countries: Mexico, Chile and Peru, account for half of the world’s proven copper reserves. The mining sector and governments in these copper-rich nations recognise and welcome the growing Chinese demand, as a recent conference in Santiago, Chile, on 9 April, reported in the Chilean daily, ‘La Segunda’, showed:

‘The projections that we have are that up until 2024, China will consume more than 50% of world copper. Hence it is, and we hope it will continue being, an important actor for global consumption of copper,’ said the Minister of Mining, Hernán de Solminihac. ‘We are optimistic with regards to China. We believe that the average consumption of copper is going to increase’ said Diego Hernández, president of Antofagasta Minerals.

Yet not all welcome increased copper mining. The extractive process for copper can have serious environmental repercussions, and NGOs and civil society in various Latin American nations have criticised any potential expansion. In Ecuador, where president Rafael Correa has already recently come under attack for his plans to allow foreign companies extract oil within Ecuador’s rainforest, NGO Salva Selva has also criticised plans to expand copper mining in particular.

‘Modern mining generates enormous quantities of solid waste and occupies huge expanses of land. In comparison to subterranean mining, open air mining produces 8-10 times more solid waste… and almost all copper in the world is mined in open air mines… Mining also uses and contaminates huge quantities of water. To produce a ton of pure copper, tens of thousands of litres of this vital resource are required daily.’


Awareness of these environmental threats has spread and a tightening of environmental and indigenous rights regulations in Latin America has made it more difficult to bring mines to operation, as reported by the Argentinean magazine El Tribuno.

In April 2012, the Canadian mine Goldcorp suffered the suspension of its environmental permit to construct a gold and copper mine ‘El Morro’, in Northern Chile, because it failed to properly seek permission from an indigenous community, owner of the zone where the site was located. This and other examples, according to analysts, are proof of a toughening of environmental regulations, in the face of more and more pressure from indigenous and environmental groups. ‘The approval of environmental impact studies is increasingly difficult, because the Chilean population is more demanding,’ said Gustafo Lagos, a mining expert from the Universidad Católica.

This is a pattern repeated across the continent. In the case of copper, the problems are compounded by the fact that there are fewer deposits of highly pure copper than there were ten years ago. This means that mines must increasingly cover a larger surface area and use a higher amount of chemicals to extract the material they need. 

Yet this has not stopped Chinese mining companies from moving in to Latin America. Erik Bethel says this is another way for China to ensure that it gets the copper it needs - going directly to the source. ‘One of the best ways to secure raw material is to go and buy mines. Chinese companies are very active in Australia and Canada, in Africa, and in Latin America, and they are spending billions of dollars in expenditure and refurbishment to get these mines up and running.’

Chinese companies like Ecuacorriente, Minmentals, Xiangguang copper, and Chinalco have already invested in mines in the area, and many of these companies will unsurprisingly be in the running for the bidding of the Las Bambas project, which Glencore was made to sell as part of the merger with Xstrata.

Now more than ever…

chinadialogue is at the heart of the battle for truth on climate change and its challenges at this critical time.

Our readers are valued by us and now, for the first time, we are asking for your support to help maintain the rigorous, honest reporting and analysis on climate change that you value in a 'post-truth' era.

Support chinadialogue

发表评论 Post a comment

评论通过管理员审核后翻译成中文或英文。 最大字符 1200。

Comments are translated into either Chinese or English after being moderated. Maximum characters 1200.

评论 comments