Incidents at mines and production facilities highlight latent risk of supply shortfalls

There have been several incidents at mines and production facilities on the metal markets in recent days that have highlighted the latent risk of supply shortfalls. Peru has been particularly affected. At a major copper mine in the country, there were violent attacks on vehicles and on the workers' residential area, according to the operator. According to the mining minister, 2,000 workers had to be evacuated as a result. Another large copper mine is operating on a limited basis due to the blocking of access roads by anti-government protesters.

This mine has been affected by blockades on and off for months. Peru is the second largest copper mine producer in the world and is currently affected by the worst unrest in years. In addition, the operator of a large tin mine in Peru has temporarily suspended operations after protests in the region resulted in numerous deaths. Production was also halted yesterday at a nickel smelting plant in Indonesia after violent clashes there left two workers dead. The incidents, which also damaged workers' vehicles and housing units, are now to be investigated. It is not yet clear how long production will remain closed. The plant went into operation at the end of 2021 and has an annual production capacity of 1.8 million tonnes. Metal prices remain well supported by this news.

Source: Commerzbank Research, Photo: Fotolia