Which country holds the top copper reserves in the world? Chile, Australia, Peru, Mexico and the US make the list.
Investors often forget to consider how much economically mineable copper there is, which is an important factor in understanding the dynamics of supply and demand in the industry.
The term peak copper was coined because some experts believe that copper reserves may be diminishing, and it’s prudent to know the top copper reserves when considering investment options.
Currently known worldwide copper resources are estimated at nearly 5.8 trillion pounds, of which only about 0.7 trillion pounds (12 percent) have been mined throughout history. Nearly all of that is still in circulation, as copper’s recycling rate is higher than that of any other engineering metal.
With that in mind, which country holds the top copper reserves? According to the most recent data from the US Geological Survey, the heavy hitters are Chile, Australia, Peru, Mexico and the US.
Copper reserves: 170,000 million MT
Chile has the largest copper reserves of any country by far, with 170 million MT as of 2017. That is nearly twice the reserves of neighboring Peru, the second-largest copper producer. The country’s reserves guarantee copper production for roughly the next 100 years at the current extraction rate.
Chile is also the world’s largest copper producer, having produced some 5.3 million MT of copper from mines in 2017. Copper plays a significant role in the Chilean economy, with an estimated 20 percent of the nation’s GDP attributed to copper production. The steady rise in copper prices has made Chile’s economy one of the strongest and most robust in Latin America.
BHP Billiton’s (ASX:BHP,LSE:BLT,NYSE:BHP) Escondida is the largest copper-producing mine in the world, and supply disruptions at the site — for example due to wage negotiations — can affect copper prices.
Copper reserves: 88,000 million MT
Australia has the second-largest copper reserves in the world next to Chile, with 88 million MT, or around 13 percent of global reserves.
According to the Australian government’s copper fact sheet, Australia’s copper resources are largely at the Olympic Dam copper-uranium–gold deposit in South Australia, and at the Mount Isa copper-lead–zinc deposit in Queensland. Other important copper resources in the country are at the Northparkes copper-gold, CSA copper-lead-zinc and Girilambone copper deposits in New South Wales; the Ernest Henry, Osborne and Mammoth copper and copper-gold deposits at Selwyn in Queensland; the copper-zinc deposits at Golden Grove; and the Nifty copper deposit in Western Australia.
Copper reserves: 81,000 million MT
Peru holds 81 million MT, or 13 percent, of the world’s copper reserves, and in 2017 the country recovered its position as the second-largest producer of the red metal. National output was 2.39 million MT in 2017, perhaps owing to a US$28.27-billion investment in the nation’s copper mines.
Peru’s largest copper reserves can be found at the Antamina, Toquepala, Cerro Verde, Cuajone and Tintaya mines. The Antamina mine in Ancash is operated by Antamina, a joint venture owned by BHP Billiton, Glencore (LSE:GLEN), Teck Resources (TSX:TECK.B,NYSE:TECK) and Mitsubishi (TSE:8306). Southern Copper (NYSE:SCCO) operates the Toquepala and Cuajone mines, Freeport-McMoRan (NYSE:FCX) operates Cerro Verde in Arequipa and the Tintaya mine is owned and operated by Glencore.
Copper reserves: 46,000 million MT
Mexico has declared that it has approximately 46 million MT in copper reserves, owned mostly by Grupo Mexico (BMV:GMEXICOB), one of the largest copper-mining companies in the world.
Grupo Mexico’s subsidiary, Buenavista del Cobre, is spending $3.4 billion to expand its copper operations in the state of Sonora, and Mexico’s copper output increased last year, possibly as a result. The country’s production rose from 752,000 MT in 2016 to 755,000 MT in 2017.
Grupo Mexico’s mining division has a subsidiary called Americas Mining, whose main subsidiaries are Southern Copper and ASARCO, a private copper mining, smelting and refining company in the US.
5. United States
Copper reserves: 45,000 million MT
The US does not depend on foreign copper at all, and is completely self sufficient due to recycling of the metal. The copper giant calculates that it holds over 45 million MT of the red metal.
US mine production of copper in 2017 increased by about 13 percent to 1.27 million MT, and was valued at about $8 billion, compared with $7.09 billion in 2016. Arizona, New Mexico, Utah, Nevada, Montana and Michigan — in descending order of production — accounted for more than 99 percent of domestic copper mine production in the US.
This is an updated version of an article first published by the Investing News Network in 2016.
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Securities Disclosure: I, Amanda Kay, hold no direct investment interest in any company mentioned in this article.