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Gold near two weeks lows as dollar rebounds

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Gold near two weeks lows as dollar rebounds

Gold prices today held near two-week lows touched in the previous session as the dollar rebounded after cautious comments from U.S. Trade Representative Robert Lighthizer stoked concerns over progress in U.S.-China trade talks.

Spot gold was down 0.1 percent at $1,318.06 per ounce as of 0132 GMT, after touching its lowest since Feb. 15 at 1316.43 in the previous session.

U.S. gold futures were flat at $1,321.40 an ounce.

The dollar held firm above a three-week low against major currencies.

The United States will need to maintain the threat of tariffs on Chinese goods for years even if Washington and Beijing strike a deal to end a costly tariff war, President Donald Trump’s chief trade negotiator, U.S. Trade Representative Robert Lighthizer, told lawmakers on Wednesday.

Asian stocks slipped on Thursday after the cautious comments from Lighthizer.

 The Federal Reserve will stop shrinking its $4 trillion balance sheet later this year, Fed Chairman Jerome Powell said on Wednesday, ending a process that investors say works at cross-purposes with the Fed’s current pause on interest-rate hikes.

U.S. President Donald Trump and North Korean leader Kim Jong Un will hold another day of talks at their second summit in eight months on Thursday, after swapping compliments at a dinner but giving no sign of progress on the key issue of denuclearisation.

UK Prime Minister Theresa May won a two-week reprieve on Wednesday from British lawmakers, who postponed a threatened rebellion aimed at blocking a no-deal Brexit after she agreed to a possible delay to Britain’s departure from the European Union.

* India and Pakistan both said they shot down each other’s fighter jets on Wednesday, with Pakistan capturing an Indian pilot a day after Indian warplanes struck inside Pakistan for the first time since a 1971 war, prompting world powers to urge restraint.

At least 8 tons of gold were removed from the Venezuelan central bank’s vaults last week, an opposition legislator and three government sources told Reuters, in the latest sign of President Nicolas Maduro’s desperation to raise hard currency amid tightening sanctions.

Indonesian authorities on Wednesday ramped up efforts to find 37 people feared buried by the collapse of an illegal gold mine on the island of Sulawesi that killed at least four people._Reuters

skom’s Molefe ‘stonewalled’ Glencore South Africa, ex-CEO Says

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skom’s Molefe ‘stonewalled’ Glencore South Africa, ex-CEO Says

South Africa’s state-owned power utility refused to renegotiate a coal deal with a mine owned by Glencore Plc’s local unit and tried to penalize it for supplying sub-standard fuel, resulting in the operation being placed in bankruptcy protection and being sold, a former head of the business said.

“It was a stonewall negotiation. It wasn’t a discussion, it was a position.”

The Optimum coal mine supplied Eskom Holdings SOC Ltd.’s Hendrina power plant and was placed under a local form of bankruptcy protection known as business rescue while owned by Glencore in August 2015. The operation was losing money because the power producer was paying a fixed price for the fuel, but the cost of mining it was rising more quickly than inflation, said Clinton Ephron, the former chief executive officer of Glencore’s local operation.

The only possible way to have saved the business would be to renegotiate the contract, he said. But when Ephron and Glencore CEO Ivan Glasenberg met then-Eskom CEO Brian Molefe about the contract, he said the electricity producer “was not willing to negotiate,” Ephron told a judicial panel probing corruption particularly during Jacob Zuma’s presidency. “It was a stonewall negotiation. It wasn’t a discussion, it was a position.”

In 2015, Glencore was pressured by former Mineral Resources Minister Mosebenzi Zwane into selling the Optimum coal complex to a company part-owned by members of the Gupta family, who were friends with Zuma, for 2.15 billion rand ($155 million). Allegations of corruption against the Guptas helped bring down his presidency. The Guptas, Zuma and Zwane deny any wrongdoing.

Glencore was “suspicious” of the actions of outside parties who forced it to sell Optimum to the Guptas, Ephron said.

The Guptas have left the country, while Optimum has been placed under administration and is in the process of being sold.

A 2016 report by the Public Protector’s office, which was led by Thuli Madonsela and ordered the set-up of the judicial commission of inquiry, found that Eskom’s conduct relating to Optimum “was solely to the benefit of Tegeta,” which belonged to the Guptas.

“We were shocked by what came out subsequently in the Public Protector’s report,” Ephron said, adding that it then became“quite easy for us to connect the dots.”

Nedbank Ltd., South Africa’s fourth-largest bank, estimates that corruption, maladministration and bad policies shaved 470 billion rand ($33.9 billion) off the nation’s gross domestic product between the start of Zuma’s second term in May 2014 and February last year, when the ruling African National Congress forced him to step down to stem a loss of support-Bloomberg News

SA platinum producers asked court to block strike

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SA platinum producers asked court to block strike
South African platinum producers, the world’s biggest miners of the metal, have asked a court to block a planned strike by one of the country’s largest mining unions that the companies say would further hurt the struggling industry.

Anglo American Platinum Ltd., the world’s top platinum-group metals supplier, and other producers want the Association of Mineworkers and Construction Union to be denied the legal right to start a seven-day strike at platinum mines on Feb. 28. The walkout would follow a strike over wages that’s been underway at Sibanye Gold Ltd.’s gold mines since November, and worsen already fraught labor relations.

 The threat of more strikes also comes as palladium, which is mined with platinum, surges to fresh records.“We are of the view that AMCU is not acting in the best interests of workers, or the industry,” the Anglo American Plc unit said. The outcome of the court interdict to block the strike is expected Wednesday.

Industry-wide action would signal deteriorating relations between producers and the militant union that held the longest-ever strike in the country’s platinum sector in 2014. Producers there operate some of the world’s deepest, costliest and most labor-intensive mines, and are bracing for a fresh round of wage talks with AMCU this year. The threat of more strikes also comes as palladium, which is mined with platinum, surges to fresh records.

Companies have a “strong legal case” to avert the strike, the Minerals Council South Africa said. The lobby group estimates producers could lose 1.3 tons of PGM production, equal to more than 500 million rand ($36 million), for each day that workers don’t show up.

Output losses will depend on the number of workers who down tools, Impala Platinum Holdings Ltd.’s spokesman said. Sibanye has made preparations for the strike and doesn’t expect production to be significantly impacted, spokesman James Wellsted said.

“In the event of a strike proceeding, it would not be the case that work could restart immediately,” the council said. “A strike is always disruptive for longer than the period of the actual strike.”-Bloomberg News

Tonnes of gold lost through illegal market

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Tonnes of gold lost through illegal market

ZIMBABWE is producing close to 100 tonnes of gold, but the bulk of that is being lost to the black market as small-scale miners, who are the main producers in the country, shun official channels, a government official has said.

Mines deputy minister Polite Kambamura told leaders of the Zimbabwe Miners Federation at a meeting in Harare yesterday that a lot of gold was being lost through informal channels.

Last year, deliveries to the sole buyer of gold, Fidelity Printers and Refinery (FPR), amounted to 33,4 tonnes.

“The bad news is that for February, after the Reserve Bank of Zimbabwe (RBZ) announced the monetary policy, we have received only 20kg, which means there is a problem there.
What we want is to mobilise and redirect gold to small-scale miners. We feel with the current challenges, we are losing gold to other markets. I am very convinced that we are already at 100 tonnes, but we are losing more gold to under-declaration and smuggling. We are losing gold to the other market due to some grievances,” Kambamura said.

The miners who attended the event said the central bank did not consult before pegging the United States dollar retention threshold at 55%.

According to the miners, the central bank was responsible for low bullion deliveries as it had failed to come up with robust ways to handle the buying of gold.

“Why does the government not open up to other players to buy gold from miners because FPR is the sole refiner and buyer of gold in the field? We understand that there are some agents who FPR are paying 90% in USD and then us, as small-scale miners, are getting a raw deal. How can a middleman get 90% in USD and yet us major producers of gold, are given a raw deal of 55% in USD and the rest in RTGS dollars”.

“So we strongly feel (that) in order to curb the loopholes, there are some elements in FPR that we feel have over stayed their mandates. The same people are sitting on boards at RBZ, FPR and Aurex. They are responsible for the buying of gold in FPR and allocation of funds, and at the end of the period, they can manipulate the whole system. We strongly feel that these people are working with gold barons, hence they are coming up with such policies that are negatively impacting the small-scale miners. If the composition of these boards does not include the primary producers, I don’t think we are heading anywhere,” said one miner.

Sasha Gomez, a gold buyer who attended the meeting, said the RBZ should pay at least 90% of the gold delivered in USD to cut out foreign buyers who pay in hard currency.

Another miner Tobias Kadenhe weighed in saying the current forex retention threshold by the central bank did not factor in costs incurred during the mining process.

Chris Hukama from Hurungwe Kariba Association said gold deliveries would remain low until authorities recognised the small-scale miners as the primary producers of gold.

“The governor said he has consulted all stakeholders, but the small-scale miners were not consulted. We have become as small-scale miners the primary producers of gold, meaning that we need recognition. A miner submits his requirement and FPR tells you who to sell to. Our economy is in a volatile situation; you can’t plan for three years in advance and yet the gold initiative fund takes years to supply the equipment we have applied for and this will eat into our planning and finances. And hence what the minister has said that up to now they only got 20kg. It is as a result of the negative attitude by RBZ towards the small-scale miners. We can’t run away from that fact. Until and unless you recognise our importance into this industry, you will get the amount of gold that you want. You must treat us fairly,” Hukama said.

NewsDay

Artisanal miners not adhering to mining regulations

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Artisanal miners not adhering to mining regulations

AN Environmental Management Agency (EMA) official has accused artisanal miners of not adhering to mining regulations and interfering with water channels, resulting in avoidable disasters.

Addressing a Zimbabwe Environmental Law Association (Zela) discussion on the possible causes of the recent Battlefields mine disaster, an EMA official, Fanuel Mangisi said artisanal miners used different underground tunnels that were only known to them and were difficult to trace.

“The lessons learnt from the Battlefields disaster is that we need to formalise artisanal mining, and we also need to encourage miners to respect the recommendations and regulations made by different institutions on issues of safe mining,” Mangisi said.

“There are many cases we deal with as EMA of, for example, our railway lines that have been threatened by artisanal miners and at Globe and Phoenix Primary School in Kwekwe, where there is mining taking place underground, and there is a sewer system in Kwekwe that is always vandalised by some illegal miners. They want to use the sewer water to process the ore and they say that it is good for processing ore.”

Mangisi said whenever the sewer is vandalised, waste spews all over and after authorities repair it, the illegal miners always vandalise it again.

“Learners at Globe and Phoenix School have said while learning they hear sounds coming from underground, and the walls of the school are cracking.

“The illegal miners detonate some dynamite close to infrastructure. We need to mine in an environmentally friendly manner, which is acceptable. If we do not protect our environment it endangers our communities and livestock can even fall into open pits,” he said.

Asked why EMA has not taken action on the Kwekwe artisanal miners, who have been vandalising infrastructure for several years, Mangisi said the panners operated at night, moved in large numbers and are armed and dangerous.

“They mine underground using numerous secret entrances. At Hwandara in Shurugwi, they operate at night and move in large numbers. In other instances, they are becoming very violent. This needs the intervention of all stakeholders, not EMA alone in terms of enforcement. This needs the intervention of EMA, the police, civic society and politicians as well,” he said.

Mangisi said whenever EMA tried to hold educational meetings with the illegal miners they refused to attend. “No one knows what is underground and it is not stable out there. When political will is there I think we can do something and deal with them,” he said.

NewsDay

Gold steady while palladium hovered near record peak

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Gold steady while palladium hovered near record peak

Gold prices were steady on Wednesday as the dollar stood near a three-week low after the Federal Reserve’s chairman reiterated the U.S. central bank would stay patient on further interest rate hikes, while palladium hovered near a record-peak.

Spot gold was flat at $1,328.90 per ounce at 0152 GMT, while U.S. gold futures were up 0.2 percent at $1,331.20.

Rising risks and recent soft data shouldn’t prevent solid growth for the U.S. economy this year, but the Fed will remain “patient” in deciding on further interest rate hikes, Fed Chair Jerome Powell said on Tuesday.

The dollar was trading near its lowest against major currencies since early February.

The pound surged against the greenback after UK Prime Minister Theresa May offered lawmakers the chance to vote in two weeks for a potentially disorderly no-deal Brexit or to delay Britain’s exit from the European Union if her attempt to ratify a divorce agreement fails.

Spot palladium, which scaled a record-peak of $1,565.09 per ounce in the previous session, was flat at $1,560.

Palladium has climbed about 24 percent this year on widening supply tightness in the market, while threats of strikes by mineworkers in South Africa added support to the autocatalyst metal

Norilsk Nickel, the world’s largest palladium producer, said tighter emissions regulations in all major markets and flattish primary supply would widen a palladium deficit in 2019.

U.S. President Donald Trump and North Korean leader Kim Jong Un meet on Wednesday for their second summit, betting that their personal relationship can break a stalemate over the North’s nuclear weapons and end more than 70 years of hostility.

In a stinging rebuke to President Trump, the House of Representatives brushed aside veto threats and passed legislation to terminate the emergency he declared at the U.S.-Mexico border in order to build a wall there.

Meanwhile, the White House formally notified Congress that if the measure passes Congress, Trump’s advisers would recommend that he veto it in order to maintain the power he activated on Feb. 15 as a way of circumventing Congress.

China’s net gold imports via main conduit Hong Kong doubled in January from the previous month, as banks in the world’s top consumer likely stocked up at the beginning of the year.

Uganda’s gold exports jumped 23 percent last year from 2017, for the first time overtaking coffee as the East African country’s top foreign exchange earner, central bank data showed.

Indonesia’s disaster agency said on Wednesday that rescuers were searching for survivors after more than 60 people were feared buried by the collapse of an illegal gold mine on the island of Sulawesi.

DATA AHEAD (GMT) 1500 Fed’s Powell to testify on U.S. monetary policy and the economy before the House Financial Services Committee-Reuters

Coal production to increase

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Coal production to increase

PRIVATE coal miner Makomo Resources says it expects to produce 350 000 tonnes of coal per month this year on the back of an anticipated increase in demand from the Zimbabwe Power Company (ZPC).

The ZPC has taken a stance to cut on coal imports due to forex challenges and procure all its requirements locally.

Makomo managing director Raymond Mutokonyi told NewsDay that the year ahead looked bright for the coal miner and would ramp up production to meet the anticipated increase in demand.

“This year looks good for us, looking at what is happening in our region, especially in South Africa where electricity is in short supply. So we will fail to import, which will force everybody to be serious about local production,” Mutokonyi said.

“We project that ZPC will need a lot of coal because they are our biggest customer. So, because they would want to have maximum output, especially as we go towards winter, we are projecting that volumes will start to increase. We will be operating at full throttle, producing between 300 000 tonnes and 350 000 tonnes (of coal) per month,” he said.

Mutokonyi said their production was demand-driven and last year the production was subdued.

“We were marginally down last year,” he said.

He said they were facing challenges such as high inflation and rising costs.

“. . . but we are seeing a bright future. Obviously, industry can’t close because of anything. As long there is a market, we will be there. So, we see the production firming up . . .,” he said.

Makomo Resources is the largest privately-owned coal producer in Zimbabwe, and it supplies the country’s thermal power stations, industrial and agricultural sectors.

NewsDay

USD, RTGS Bank exchange rate impacts operations: Mahlahla

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USD, RTGS Bank exchange rate impacts operations: Mahlahla

Yesterday the Zimbabwe Miners Federation (ZMF) National Chrome Representative Mashonaland Central ZMF chairperson Masango Mahlahla presented a seven point grievance list at the ZMF MONETARY POLICY REVIEW BREAKFAST MEETING attended by  Ministry of Mines led by Deputy Minister Polite Kambamura and the Reserve Bank of Zimbabwe (RBZ) led by  William B.  Manhimanzi following the new monetary policy presented last week at a meeting held at Rainbow towers’ Harare International Conference Centre (HICC) in Harare.

Rudairo Dickson Mapuranga

According to Mahlahla, miners were of the view that RBZ would be using the exchange rate which was being offered at the parallel market and were hopeful the policy presentation was long overdue, however, RBZ failed to reach miners expectations when they failed to adhere to market forces.

“As the ZMF National Chrome Representative, we are advocating for 80% USD and 20% RTGS valued at the current market rates, taking into consideration the country’s need for foreign currency to support industry and commerce, market rates were noted to be rated between 3.5 and 4 by the RBZ Governor in his new monetary policy speech last week. Additionally we are advocating for a review of the 30 days retention policy upwards to 6months to one year.  Our expectation as chrome miners was that the RBZ would start the exchange rate at the current parallel market rate of 3.5 to 4.  As the RBZ formalized the trading of RTGS to USD, the market would then receive the steady supply of foreign currency which in turn would reduce the gap in value between RTGS and USD overtime.  In this case the start rate of 2.5 was too aggressive and immediately negatively impacts our business operations” said Mahlahla.

 

Mahlahla said that, it is high time the mining sector is transformed from being dominated by the small scale semi-mechanized operations and grown to fully mechanized operations as growth in the sector is too vital, he also lamented over USD retention because equipment purchases and rentals are still paid in USD.

“Our Equipment is imported and priced in Foreign Currency. In order for small scale miners to grow and increase production and efficiency we need to move our operations from being semi-mechanized to fully mechanized through the purchase and ownership of mining equipment such as, Dump Trucks, Front End Loaders, Excavators, Bulldozers et cetera” said Mahlahla.

 

It is the miners’ view that for the development of the mining sector, each piece of equipment can cost over $300,000 USD new and on average a used piece of equipment can cost around $100,000 USD each. Most small scale chrome mines are critically undercapitalized and require the access of sales proceeds in the form of foreign currency in order to grow operations. Masango Mahlahla said that the only solution towards turning the mining sector to a favorable outcome is by increasing foreign currency retention.

“Due to the challenges faced within our economy which includes conflicting government business policies, foreign banks as well as domestic banks are unwilling to loan money to chrome miners who have very low foreign currency reserves within their bank accounts.  Having high retained foreign currency cash reserves within a miners bank account will enable a miner to make strategic purchases and even obtain loans” said Mahlahla.

Mahlahla pointed out that, ZMF is in support of the Ministry of Mines and Mining Development to promote formalization of mining as well as best business practices, however, there is a need for strong financial management.

“The 30 days retention will push miners to make rushed spending decisions and lose out on strategic purchases which can only be obtained when a miner has the foreign currency available in the bank on short notice. The thought that preowned mining equipment can be purchased internationally under our current economic environment along with conflicting business policy challenges via payment plans is not a realistic assumption” he said.

 

Experts believe that chrome production growth is further being suppressed due to the collusion by foreign buyers who have setup domestic buying operations.  All buyers are now activity working together to keep chrome prices artificially low.  Whereas the current export sales price of chrome is around $85 USD per tonne the buyers are paying as low as $12 USD per tonne.

“We as chrome miners are requesting RBZ and the Ministry of Mines and Mining Development to investigate the domestic Buyers and to cancel all export and business licenses of any buyer found to be predatory buying chrome.  New Buyers should be invited in who are willing to conform to Zimbabwean business laws and pay international market based prices in order for our industry to grow’ Mahlahla said.

De Beers merges Canadian, South African assets

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De Beers merges Canadian, South African assets

De Beers Group has decided to merge its mining assets in Canada and South Africa under the name De Beers Group Managed Operations. The change is expected to create a more sustainable business and to streamline operations in both countries.

De Beers announced the change as its mining footprint in both countries is shrinking due to the closure of the Snap Lake mine in Canada’s Northwest Territory and South Africa’s Voorspoed mine plus the already announced closure in May of the Victor mine in Ontario.

Mpumi Zikalala

The new managing director of De Beers Group Managed Operations will be Nompumelelo (Mpumi) Zikalala. She and the management team will work out of offices in Johannesburg. Joining her is Allan Rodel as head of operations. Additional support services will be maintained in Canada. Zikalala’s responsibilities will include those currently held by Phillip Barton, CEO of De Beers Consolidated Mining, and Kim Truter, CEO of De Beers Canada. Both men are leaving the organization to focus on new opportunities.

This story first appeared in Canadian Mining Journal.

Tax war won at cost

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Tax war won at cost

Last year it was the Democratic Republic of Congo. This year it is Zambia.

Both African countries have driven through draconian changes to their mineral tax regimes, overcoming the entrenched opposition of some of the world’s biggest mining houses.

Both are betting that the world’s need for their resources, particularly copper and cobalt, will keep the tax receipts flowing.

Right now, however, the push for a greater share of the wealth lying beneath the African Copperbelt is causing supply-chain disruption for both copper and cobalt.Operating in both the Congo and Zambia just got more expensive.

One Zambian copper smelter has closed, another has reduced operations and Glencore last week confirmed media reports it will be cutting production at its Mutanda mine in the Congo.

The news sparked a rally in the copper market underlining just how important these two African countries have become to the global supply picture.

Cobalt barely reacted because last year’s “hot” metal is still digesting the production glut that followed the 2017 price surge.

The current supply turbulence, however, promises more volatility ahead for cobalt as well as copper.

Miners lose rumble in the jungle

The Congo and Zambia have for some time been slugging it out with mining companies about the proposed tax changes.

The arguments were still playing out at the Mining Indaba conference in Cape Town earlier this month.

But the miners have lost the contest.

Congo signed its new mining code into law in June last year.

Copper royalties were raised from 2.0 to 3.5 percent and those on gold from 2.5 to 3.5 percent. A new “super profits” tax, set at 50 percent, was introduced. It kicks in when profits exceed 25 percent of those forecast in a mine’s original feasibility study.

Miners took another blow in December, when Congo declared cobalt a “strategic” mineral, nearly tripling the royalty rate to 10 percent.

Zambia’s tax hits on miners came into effect at the start of this year, lifting the sliding royalty scale by 1.5 percentage points to between 5.5 to 7.5 percent, depending on the copper price.

If copper exceeds $7,500 and $9,000, the royalty rate will go up to 8.5 and 10.0 percent respectively.

A new 15-percent royalty on gold and gemstones has also been introduced, while mining companies are waiting nervously to see the details of the Zambian government’s plan to replace value added tax with a non-refundable sales tax at the start of April.

Operating in both the Congo and Zambia just got more expensive.

Border disruption

However, it’s a less headline-grabbing change in Zambia’s tax system that has caused the immediate supply chain disruption.

A new 5.0-percent import tax on copper concentrates has halted the flow of raw materials from Congo to smelters in Zambia.

The latter has excess smelting capacity, the former too little.

Smelters such as Vedanta’s Nchanga and ERG’s Chambishi have historically relied on Congo for part or all of their feed.

The reaction to the new import tax has been swift, Nchanga reducing output and Chambishi closing. Each has generated knock-on effects.

Nchanga operations have been “rationalised” because the new import duty makes smelting Congolese concentrates “commercially unviable”, according to local operating unit Konkola Copper Mines (KCM).

The smelter produced 135,000 tonnes of refined copper in the first nine months of 2018, including 67,000 tonnes from third-party, for which read Congolese, feed.

Lower output at the smelter means less sulphuric acid for the Nchanga copper mine, where the acid is used to leach concentrate into metal. KCM therefore suspended mining operations at the start of January.

ERG has shuttered its smaller 50,000-tonne per year Chambishi smelter because it was wholly reliant for feed on concentrates from the company’s Boss Mining and Frontier operations in the Congo.

This too has caused a ripple effect, Fastmarkets reporting that ERG is now placing Boss Mining on care and maintenance as the company studies the feasibility of adding more processing capacity to treat the concentrates previously headed for its Zambian processing plant.

ERG’s cross-border flow included cobalt raw materials for refining at Chambishi, putting another kink into this market’s volatile supply side.

Future threats

Glencore is facing a similar dilemma to ERG at its Mutanda mine, where the ore body is transitioning from oxide, suitable for straight-to-metal leaching, to sulphide, which generally requires processing by a smelter.

Such ore body changes are not uncommon in copper mines as early operations deplete the near-surface oxide deposits which overlay the deeper sulphide deposits.

A new mine plan will halve Mutanda’s production to 100,000 tonnes going forward, “pending an investment decision on whether and how to process the now increased sulphide reserves/resources,” Glencore said.

An investment decision that has been made more difficult by Congo’s tougher tax regime and the potential for more changes ahead.

Another key proviso of last year’s new mining code was a reduction in operating contract stability from 10 to 5 years, meaning more frequent potential shifts of the goal-posts by the government.

Glencore’s investment decision at Mutanda will be a micro play-out of a broader theme. Have Congo and Zambia pushed the redistribution of resource wealth too far by stifling investment in future production?

Too big to lose

Mining companies fear that this may not be the last assault in either country, given both are burdened by heavy national debt and creaking budgets.

They are also, however, key sources of two metals expected to see fast-accelerating demand from the electric vehicle revolution, cobalt for lithium-ion batteries and copper for the infrastructure that will enable that revolution.

Cobalt’s dependence on the Congo is a well understood problem for both lithium-ion battery manufacturers and their automotive customers.

Greater assertiveness by Congo’s government joins a long list of supply stability issues.

Copper, by contrast, must learn anew the potential for central Africa to instill unpredictability into the price.

Congo’s copper production collapsed over the 1990s and early 2000s to the point that it lost its former preeminent role in the global production picture.

But now it’s back. National output has grown from under 30,000 tonnes in 2005 to 1.2 million tonnes in 2018. Along with Zambia’s output of 800,000 tonnes, the two countries account for around a tenth of global production.

Only time will tell if Congo and Zambia are right in their belief that miners will accept, however reluctantly, the new costs of doing business.

But the short term outlook is for more supply-chain turbulence-Reuters

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