The operator of some of Europe’s largest copper and zinc mines expects President Donald Trump’s plans to spend on U.S. infrastructure to have much less impact on base-metal prices than the needs of burgeoning middle-class populations in emerging markets.
That’s because projects in the U.S. and other developed countries simply won’t use enough zinc or copper to have any significant impact on prices, Lennart Evrell, chief executive officer of Sweden’s Boliden AB, said in a March 22 interview. When poorer and less-developed countries decide to build transport and power networks they consume far more of these materials, he said.
“The U.S. is not big enough when it comes to commodities,” Evrell said. “It may be a very big economy, but when it comes to need for base metals, it’s more about the earlier stages of a country’s development, and the U.S. is not in that phase. We believe the driver behind the recent metals price increases is the rest of the world, and not Trump, as prices fell roughly as much after his election as they had gained in conjunction with his election.”’
While base metals gained after Trump’s election victory in early November, his promise of investment in U.S. infrastructure “has less effect than what you read in the newspapers,” Evrell said. Boliden, which is the world’s fifth-largest zinc miner and operates mines in Sweden, Finland and Ireland, along with smelters in the Nordic region, is instead betting on emerging markets.
“The countries that are leaving poverty, that’s where you start building prosperity: schools, transport systems and energy systems — that’s what driving our development,” Evrell said at the company’s headquarters in Stockholm.
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