Latin America: the key to net-zero
The US recession is bad news for investors. But at least it lets them retell an old joke. Dr Copper’s diagnosis was accurate once again: the price of “the only metal with a PhD in Economics” dropped before the current economic downturn.
Yet while copper is an excellent predictor of GDP movements owing to its widespread use, it is rubbish at spotting energy transitions. Over the next 30 years governments, investors and companies will spend trillions electrifying the global economy. The goal is to fight climate change by replacing carbon-emitting fossil fuels with renewable energy. The “great electrification” will require huge amounts of copper for the generation, transmission and consumption of this clean power.
A severe supply squeeze
There is just one problem. The world can’t produce enough copper quickly or cheaply enough to fulfil these ambitions. The largest copper mine in the world is La Escondida in Chile. Mining analysts Wood Mackenzie estimate that five more Escondidas would need to come online over the
