With major mining countries ramping up efforts to contain spread of the coronavirus outbreak, it has triggered supply concerns for copper, which in turn has resulted the metal’s escalating prices. Further, the industrial metal gained on the U.S. Federal Reserve’s announcement of extensive new measures to support the U.S economy. Copper prices were up 1.5% to close at $2.15 per pound on Mar 23, 2020.
The Fed pledged to buy an unlimited amount of Treasury and mortgage-backed securities, as required. It also announced three new lending facilities to support consumer and business credit markets. The Fed also announced that it will soon roll out a program to support lending to eligible small-and-medium sized businesses.
Coronavirus cases across the globe have escalated to 332,930, per WHO’s situation report as of Mar 23, 2020, while the death toll stands at 14,510.
To limit the spread, many countries have put in place travel or border restrictions and other measures such as constrained movement and quarantines. Consequently, metal producers are suspending production, slowing project construction or limiting operations to critical activities.
The Peruvian Government, for instance, has closed borders and declaring a state of national emergency requiring a 15-day quarantine. Peru is a global mining powerhouse — ranking third in global copper production, second for silver and sixth for gold and also boasts significant reserves of zinc, lead, iron ore and tin.
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