Congo Trumps Zambia as Top African Copper Miner, CRU SaysMatthew Hill
Copper mined in the Democratic Republic of Congo last year probably surpassed Zambian output for the first time since 1988, making it Africa’s biggest producer, according to CRU Group.
Congo produced 846,000 metric tons of the metal in 2013, about 2 percent more than its southern neighbor, Piotr Ortonowski, a copper consultant at the London-based commodities analysis company, said yesterday, citing preliminary figures. Each country has the scope to more than double volumes in the next decade, he said.
“This is potential production from projects and it is highly unlikely that it will all come on stream –- realistically only 50 percent to 60 percent of it will,” he said. “It will be the nations’ ability to provide a favorable investment environment to mine-project developers that will determine which will be the most successful.”
Mining investment has spurred economic growth in Zambia and Congo as companies seek to benefit from prices for copper, the metal used in plumbing and electrical wiring, that have more than doubled in a decade. Both countries are revising mining legislation and considering increasing royalties.
First Quantum Minerals Ltd., Toronto-based Barrick Gold Corp. and Vedanta Resources Plc are among companies that have mines in Zambia. The biggest producers in the DRC are Freeport-McMoRan Copper & Gold Inc. and Eurasian Natural Resources Corp. Baar, Switzerland-based Glencore Xstrata Plc operates in both.
Congo may expand its copper output by more that 250,000 tons this year, making it the biggest contributor to growth in global output after Chile, Gayle Berry, a metals analyst at Barclays Plc’s investment-banking unit London, said by e-mail.
The greatest concerns among investors in the Zambian and Congo mining industries are the stability of mining laws, electricity supplies and security, CRU’s Ortonowski said.
Congo produced more than 900,000 tons of copper last year, the International Monetary Fund said Feb. 25. Output in Zambia for the first 11 months of 2013 was 916,000 tons, according to the country’s central bank. The Chamber of Mines of Zambia disputes the figure, saying it’s inflated by double-counting.
The price of copper for delivery in three months has fallen 11 percent on the London Metal exchange over the past year, trading at $7,027 a ton at 11:54 a.m. in London.