Base metal counters have focused on the potential for another economic contraction as a result of a more infectious strain of COVID-19 rearing its head in the United Kingdom. Actions by policymakers have been swift but there will be an undoubted impact on the EU/UK as travel and trade has come to a standstill over the past couple of days. Granted France has agreed to allow freight etc, but the damage to sentiment has been done.
3m LME Copper continued to fall shedding some 0.2% to $7729/tonne by 05:00 am local time, while 3m LME Nickel fell to a level last seen on Dec 8 at $16295 tonne, down some 1.9% on the session.
Anglo American CEO Mark Cutifani was on the wires stating that the firm is tentatively venturing into Zambia and will have talks with the government over best-practice mining policies if it finds a copper deposit worth developing. According to the CEO, Anglo is well aware of developments and will hammer out the best mining investment agreement possible before making an investment if it did find an economically viable deposit. Cutifani added that Anglo was aware of the current policies and that they would not place big investments, but if their exploration was successful, they could engage the government. While Anglo’s presence in Zambia is limited to exploration and is marked by a cautious approach, there are ominous signs of continued government meddling in the mining industry and poor decision making coupled with continued policy uncertainty and an unfavourable tax regime.