Specialist
Former EVP at Vale Canada Ltd
Agenda
- Effects from China's restrictions on Australian copper ore
- Industry trends around risk management
- Medium-term demand from electric vehicles
- 2021 global consumption outlook
Questions
1.
What challenges did copper producers face prior to 2020? How has the operating environment changed since then?
2.
Has the supply gap been filled since summer 2020? What issues caused the deficit? Was it primarily coronavirus-related?
3.
In 2020 labour disputes halted or disrupted copper production, primarily in Chile, and these disputes remain an issue as production resumes. What is the significance of Chile’s copper industry to the global supply? How important is the quality of Chile’s export copper to the market?
4.
What do you think are the main side effects of China’s ban on copper concentrate from Australia? If this dispute is resolved soon, do you think the effects will linger through Q1 and perhaps further into 2021?
5.
Glencore is in the final stages of negotiations to sell its stake in Mopani to the Zambian government. Do you think this is a good or bad sign for the future of greenfield?
6.
How have producers historically approached growth, especially with mid-tier producers? Do you think there is favouritism for brownfield vs M&A for the mid-tier producers?
7.
What are the noteworthy brownfields coming into production in the next few years?
8.
Why do you think the opportunity for stimulus isn’t as large as it was in the last cycle? What do you think will ultimately drive price?
9.
Last cycle there was quite a bit of a demand driven by China, primarily because its infrastructure needed to be modernised. Do you think there is an opportunity for global copper to experience the same level of pricing growth this cycle? If so, where does that opportunity lie?
10.
2020 was a substantial year for EV [electric vehicle] producers, as more manufacturers entered the space with new product lines and battery platforms. Could you tell us about the EV battery platform? What does it mean for future copper consumption? Are there differences in the copper applications for EVs vs ICEs [internal combustion engines]?
11.
Do you think the shift from ICEs to EVs creates an opportunity for copper producers to manufacture differentiated products and boost margins?
12.
The electrification of personal transport suggests that higher-quality batteries and input consistency will be crucial for automakers and the manufacturing process. How does the issue of quality control apply for an automaker?
13.
How do you think the green revolution will change the copper supply chain? Has coronavirus created a greater incentive for more regionalised processing capability?
14.
Freeport trimmed its 2021 production guidance after Q4 2020 copper sales were down about 4.4% YoY. Do you have any idea why this is the case, given that its cash costs are also down?
15.
There has been some weakness in copper demand and pricing due to China’s reduced manufacturing activity. Do you think this is largely due to the Chinese New Year and holiday, or could there be something else there, perhaps with regards to how China is managing coronavirus lockdowns?
16.
Do you think some producers’ margins might be squeezed as the life mines get depleted, or do you think we’re still a long way off from that?
17.
Do you expect any more pricing shocks, or a dip to pre-coronavirus prices in H2 2021?
18.
Is there anything else you want to highlight or expand on?
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