The copper price may have dipped during Wednesday trading hours, but there were fresh worries over the situation in Peru as miners in the country began a two-day strike.
A state of emergency was declared in the Peruvian state of Arequipa on Friday following two months of violent protests at Southern Copper's (NYSE: SCCO) Tia Maria copper project. Development at Tia Maria was put on hold for two months beginning on May 15. Now, unions and other organizations in a number of states are supporting farmers who oppose the project through a 48-hour strike. MetalBulletin reported that unions and other organizations in Arequipa, Moquegua, Tacna and Ayacucho will strike in support of the protest, while those in Cusco and Puno will hold demonstrations, but won't strike. According to Carlos Galvez, president of Peru's National Society of Mining, Petroleum and Energy, and SFO of Cia. de Minas Buenaventura, Peru's largest precious metals producer, violence in the country could stymie Peru's goal to move up the list of top copper-producing countries as investment in the country is threatened and new projects are delayed. "These people have a clear objective — no economic development — and they're achieving it," he told Bloomberg. "They're opposing projects approved by the state. What's most worrying is that the next step is opposing existing operations." Copper price under pressure While market watchers may have expected conditions in Peru to provide support for the copper price, spot copper fell 0.31 percent on Wednesday, to $2.76 per pound. Meanwhile, the LME copper price dipped 0.4 percent, to $6,083 per tonne, marking the lowest price for the metal since late April, according to Reuters.