Peru's mining exports plummeted in November

Peru's mining exports, particularly copper, gold, tin and zinc, among others – dropped significantly in the first 11 months of 2022. 

The FOB value of exports plunged 27.5% year-on-year in November, pulling the total down for the first 11 months of the year to US$31.8bn, some 6.4% lower than in January-November last year. 

The ongoing conflict over the removal of president Pedro Castillo will also hit export figures for December, since the protests and roadblocks are preventing minerals from reaching ports. 

The protests are estimated to have resulted in a loss of around one percentage point of GDP in December, according to the economy and finance ministry.

COMMODITIES

Most exports of individual metals declined in November, with foreign copper sales diving 33.3% year-on-year to US$1.44bn, gold falling 18.6% to US$563mn, zinc down 25.8% to US$214mn and iron ore sliding 30.6% to US$100mn, according to the latest report from the foreign trade and tourism ministry (Mincetur).

For January-November, copper exports – which account for 31% of Peru's total mining exports – dipped 6.9% to US$17.5bn, due partly to lower prices during the second half of 2022. 

“Prices in 2H22 fell significantly compared with 2H21. In the case of copper, the price fell 18% in November compared with the same period of 2021. The gold price fell 5%,” Fernando Gonzáles, a senior economist at Peruvian economics think tank IPE, told BNamericas.

Meanwhile, iron ore shipments were down 26% to US$1.55bn in January-November, while gold exports decreased 3.8% to US$6.9bn. Only zinc and molybdenum – together representing 6.2% of Peruvian mining exports – saw increases in the period, rising 8.4% (US$2.57bn) and 6.9% (US$956mn), respectively.

Given the figures for January-November, it is highly likely that exports for the year will be lower than in 2021 due to the political situation. 

“Whenever there’s a large drop, there’s a rebound the following month. There are months when more is shipped and others when products are stored for the future. The great limitation in December will be the roadblocks. What happens, the year will close with a decrease,” Gonzáles added.

In mid-December, Las Bambas – which is owned by Chinese-controlled mining company MMG – stated that the protests and roadblocks were causing its Apurímac operations daily losses of US$6mn by preventing concentrate from being transported to ports. 

In late December, the government confirmed that all roadblocks had been cleared, but the conflicts have resurged and new interruptions have been reported.

The mines in southern Peru – Las Bambas, Hudbay and Antapaccay – have been unable to transport copper concentrate due to blocks on sections of the southern mining corridor (CMS). The CMS connects various mines in the interior of the country with Matarani port on the coast of Arequipa region. 

The transport and communications ministry has said that there is restricted traffic on three sections of the mining corridor and there is a threat that rural will try to illegally invade mine operations, so the outlook does not look encouraging for the mining industry for the near future at least.