Here’s something to give a fresh shot in the arm to copper, the second-best-performing base metal over the past three months: the prospect of strike action at its biggest pit.
Management at BHP Billiton Ltd.-run Escondida in Chile have rejected union demands for a 7 percent pay rise and 25 million peso ($37,300) bonus, and talks are ongoing ahead of a vote by workers on a final proposal Jan. 24, Bloomberg News reported Wednesday.
As Gadfly argued in September, the risk of industrial action is one of the major supply-side factors supporting copper at the moment. Escondida accounted for about 1.2 million metric tons of mined copper in 2015, so any stoppage could sharply tighten a market that Bloomberg Intelligence estimates will see a 453,000-ton surplus this year. Continue Reading →