The last time copper earnings got close to reaching the exports seen in the first three months of this year, was in the second quarter of 2015 when sales stood at P1.2 billion.
That period marked the beginning of a global copper price meltdown that eventually pushed BCL Limited into liquidation in October 2016.
Bank of Botswana statistics show that the robust first quarter exports extended into April, exclusively benefiting Khoemacau Copper Mine, which until last week, was the country's sole producer of the red metal. Newly inaugurated Sandfire Resources' Motheo Copper Mine targets production of 20,000 tonnes this year, increasing to 40,000 tonnes in 2024 Kitso Mokhurutshe, an investment analyst at Kgori Capital, cited an anticipated energy crisis in Europe as a propeller of copper's strong performance.
“Copper has entered into a fifth consecutive quarter of growth with Q1 sales up by 15% from the previous quarter due to varying factors such as an increase in demand for the metal after a predicted energy crisis in Europe," he articulated during a recent briefing.
Mokhurutshe anticipated that the favourable market conditions for copper would translate into an elevated valuation for Khoemacau, recently introduced to the market. Global analysts forecast continued elevation for copper, following the US Department of Energy's historic inclusion of copper in its critical raw materials inventory.
This move acknowledges copper's burgeoning importance to the worldwide energy transition. Department officials asserted, “As our nation continues the transition to a clean energy economy, it is our responsibility to anticipate critical material supply chains needed to manufacture our most promising clean energy generation, transmission storage and end-use technologies, including solar panels, wind turbines, power electronics, lighting, and electric vehicles.” Copper's present fortunes sharply contrast with 2016, when international prices plummeted, predominantly due to China's economic deceleration, impacting red metal demand.
China's reduced appetite for copper had a cascading effect on producers like BCL Limited, which incurred losses of P1.5 billion in 2015. The former minister of Mineral Resources, Sadique Kebonang, argued against further financial infusion into BCL Mine, deeming it economically imprudent, culminating in the group's dissolution. Mowana Copper, the nation's other producer, also shuttered in 2015 and is now incrementally resuming operations after the acquisition by Max Power Limited, spearheaded by Dutch wealth manager Gregory Elias. Revitalisation of erstwhile BCL Limited, encompassing BCL Mine and Selkirk Mine from Tati Nickel, is underway under the auspices of Canadian entity Premium Nickel Resources.
