‘Keep on going’, urges Freeport chief – by Henry Sanderson and Neil Hume (Financial Times – October 15, 2015)


Copper miner CEO says tough decisions needed as low prices reign

“If you’re going through hell, keep on going.” That is how Richard Adkerson, chief executive of US copper miner Freeport-McMoRan, summed up sentiment at his company’s party to mark the end of LME Week in London.

The song by Rodney Adkins was an apt metaphor for this year’s annual gathering of miners, traders and smelters, who are dealing with commodity prices at their lowest levels since the financial crisis.

Miners and traders look forward to Freeport’s party every year, but Wednesday’s bash at the Intercontinental Hotel in Park Lane reflected the new austerity: gone were the oysters and the large arrays of sushi stations. Delegates picked at marshmallows dipped in chocolate instead.

One attendee reflected on the boom years, remembering how people would retire to private clubs nearby for all-night parties, providing their Chinese guests with lavish entertainment.

“Listen my friends in the industry, we’re going through hell in a lot of ways, but we’re keeping on moving,” said Mr Adkerson, who has run the company since 2008. “We’re in an industry that’s going to have a brighter future. We all have to be realistic about what we’re facing right now and make tough decisions and keep on moving.”

There were discussions during the week on the growing pessimism over the future outlook for industrial metals.

While Chinese hedge funds were said to be the most bearish on metals at the beginning of the year, anticipating weak demand in the country, western analysts have now caught up.
But LME Week attendees said Chinese funds — in part burnt by the summer’s equity market volatility — were currently sitting on cash, unsure of the direction of the market. Shanghai Chaos, rumoured to be behind a big copper short at the beginning of the year, even apologised to its investors in August for losing money in the equity market.

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