You could understand why the mood might be dour at the annual Society for Mining, Metallurgy and Exploration conference in Duluth this week. With the price of iron ore less than half what it was when last year’s conference was held, layoffs rampant and foreign steel flooding the U.S.economy, the 600 or more regional mining industry folks gathered here weren’t exactly whooping it up.
But Jon Cherry, president and chief executive officer of PolyMet Minerals, said copper may be the balm that soothes what ails northern Minnesota’s mining industry.
Iron ore that sold for $180 per ton in 2011 and $100 one year ago now is going for about $47. And while Cherry said he understands his brothers and sisters in the iron ore mining industry are facing “difficult challenges” with predictions of sub-$40-per-ton iron ore prices, he was happy to proclaim that “these are exciting times for PolyMet” and copper in Minnesota.
Cherry, the conference’s closing plenary speaker, said his company is projecting that both global supply and demand for copper will remain relatively stable through 2017 before both start to increase. In the meantime, he predicts stable prices, and nothing like the free-fall of iron ore prices, on the horizon for copper.
Demand for copper has grown by an average of 3 percent annually over the past 30 years, with only two years — 1990 and 2001 — where it didn’t go up, Cherry said. Moreover, global supply, while predicted to increase with new mines, has remained mostly flat, leaving the market “in balance.”
Building a copper mining industry in Minnesota will help smooth out the ups and downs of the iron ore industry that is much more cyclical, Cherry told the conference
“The opportunity to diversify and bring more metals into the mining economy up here is a great opportunity” for Northeastern Minnesota, Cherry said.
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