According to the DRC’s central bank, production of both metals, along with gold, increased in the first nine months of the year.
Copper production in the Democratic Republic of Congo (DRC) rose by 9.3 percent in the first nine months of the year, the country’s central bank said on Monday (November 6).
According to a report, copper output reached 831,000 tonnes from January to September of this year, but increasing inflation remains a risk to the country’s economy.
The bank warns in the document that if monetary policy and austerity measures are relaxed, the DRC’s annual inflation rate could reach 76 percent by the end of the year. The franc is also expected to fall by as much as 39 percent if policies are not maintained.
“Based only on the historic inflationist behavior of the final quarter [of the year] due to the year-end festivities, it is unlikely that the current rigor will be maintained without creating social discontent,” the central bank said.
The DRC’s economy has also been hit by political instability due to delays in elections to replace President Joseph Kabila. They will finally take place in December 2018, two years after they were originally scheduled, the DRC’s electoral commission confirmed on Monday.
The mining and oil sectors represent about 95 percent of the DRC’s export revenues. As the production of copper and other metals increases, some of the country’s economic problems could ease.
Last year, copper production in the country decreased to 910,000 MT from 1.02 million MT in 2015. The fall was caused by Glencore’s (LSE:GLEN) partial suspension of activity at its Katanga operation, which is due to restart later this year.
Other copper-focused companies in the African country include China Minmetals, MMG (HKEX:1208), Tiger Resources (ASX:TGS) and Ivanhoe Mines (TSX:IVN).
In addition to being a key copper producer, the DRC is the world’s largest cobalt-producing country, accounting for roughly 60 percent of global output. According to the central bank’s report, cobalt production increased by 18 percent in the first nine months of the year, hitting 59,000 tonnes, while gold production rose 5.7 percent to reach 23,000 kilograms.
On Monday, LME copper closed up 1.1 percent, at $6,970 per tonne.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.