Chile: Copper prices jumped in July as strikes triggered supply fears
August 1, 2011
In July, copper prices rose 4.6% over the previous month to reach USD 9,731 per tonne (equivalent to USD 4.41 per pound), after prices had increased a tiny 0.8% in June. With the July price increase, copper prices moved closer to the USD 9,858 per tonne peak recorded in February, which had marked the highest end-of-month level on record. In annual terms, copper prices are 35.2% higher than in the same month last year. On 5 August, the two-week strike at the Escondida mine (the world's largest copper mine), which saw prices soaring on increasing fears of supply shortages, came to end after unions accepted a new bonus offer from the mine's operator. The end of the strike at the mine, which extracts 7% of the world's copper, should ease supply fears and lead to a moderation in copper prices as the global economic recovery falters. High prices for copper, which accounts for half of the country's total exports, saw exports expand 19.2% year-on-year in July. Moreover, the 3-month sum in exports reached USD 21.3 billion in July, which exceeded the USD 19.7 billion peak recorded in May 2008.