Africa will be recognised as the biggest contributor to the growth of mined copper production from 2013 to 2017 in percentage terms, says research and consulting firm Wood Mackenzie base metals research head Helen Matthews, who highlights Zambia and the Democratic Republic of Congo (DRC) as key contributors to a growth of 1.36-million tonnes over the period.

“African mine output will peak in 2018 and decline thereafter if no new mines are devel-oped,” predicts Matthews, adding, however, that Africa’s refined copper production capability is forecast to increase by 600 000 t between 2013 and 2017, with the strongest growth expected to come from the DRC and Zambia.

Copper mines currently operating in Africa include the Kansanshi copper mine near Solwezi, in Zambia, 80% of which is owned by mining and metals company First Quantum Minerals subsidiary Kansanshi Mining; Zambia’s Lumwana copper mine, owned by gold mining major Barrick Gold; and the $450-million greenfield Lubambe copper mining project, owned by diversified mining major Vale, mining and minerals company African Rainbow Resources and investment group Zambia Consolidated Copper Mines Investment Holdings.

Africa currently accounts for about 1% of global base metals demand, 9% of mine produc-tion and 1% of refined production. Matthews says, however, that “demand growth is forecast to slow marginally over the next few years, with low growth for zinc and nickel and a contraction in lead demand as a result of increased battery imports – this will partly offset growth in aluminium and copper consumption”.

Still, Wood Mackenzie predicts that copper demand will benefit from a recovery over the next five years, with Egypt being a low-cost centre for wire-rod production for Europe and the Gulf Cooperation Council.

North Africa is also becoming an attractive low-cost manufacturing centre for Western Europe, Matthews adds.

South Africa’s Prospects

Matthews points out that, while Africa will increase copper mine production over the following five years, the same timeframe does not bode well for South Africa, as the country’s slow growth in copper demand is directly proportionate to its gross domestic product growth.

She says mine output from South Africa will shrink by 15% by 2017 and refined output will drop sharply with the closure of certain mines in 2016, as a result of reserve depletion. This is despite the Palabora copper mines, in Limpopo, owned until recently by diversified mining company Rio Tinto South Africa, which currently produce about 70 000 t/y of copper.

“Further, Africa is declining in importance as a source of mined and refined zinc, which is reflected in the scheduled closure of the continent’s largest zinc mine and smelting complex, Skorpion, in Namibia, owing to predicted ore reserve depletion in 2016,” she says.

The Skorpion zinc mine and refinery operation, owned by international mining company Vedanta Resources, is the eighth-largest zinc mine in the world and is located near the southern town of Rosh Pinah, in Namibia. Opencast mining and hydrometallurgical systems are used to mine and refine zinc oxide to produce special high-grade (SHG) zinc, while the mine’s capacity is about 150 000 t of SHG zinc a year, according to Vedanta.

However, Matthews maintains that there is potential for the life of the smelter to be extended if it is adapted to treat other concentrates.

“The closure of the mine could be offset if Vedanta proceeds with the development of the 200 000-t-a-year Gamsberg zinc project, in South Africa,” she argues, adding that output from these and other operations comfortably exceed African zinc consumption, which is not expected to increase significantly in the medium term.

In addition, lead mine production is forecast to decrease in the medium term, owing to lower output from the Vedanta-owned Black Mountain mine, in South Africa, which is due to close in 2021.

South American Prospects

While demand and refined output growth are projected to remain steady in terms of global market share over the next few years, copper and zinc production is expected to increase in South America and the Caribbean, says Matthews.

These regions currently account for about 3% of global base metals demand, 22% of global mine production and 11% of global refined output for aluminium, copper, nickel, lead and zinc.

Aluminium, copper, lead and zinc are all expected to show reasonable demand growth over the medium term, says Matthews, add- ing that South American copper consump- tion increased by 3.9% last year and that Wood Mackenzie is expecting a similar increase this year.

“This region is forecast to post the largest increase in copper production capability in absolute terms from 2013 to 2017, with an increase of more than 1.5-million tonnes, supported by output from new mines and expansions in the region,” she emphasises.

Matthews further highlights the importance of South America as a zinc-mining region, which is “second only to China in terms of yearly mined production”.

“Several relatively small expansions at many South American mines will result in production growth, which will peak in the second half of the decade at about 2.2-million tonnes a year,” she says.

Although there are no large advanced-stage projects in the region, Matthews believes the nature and quality of the zinc deposits typically mined in South America indicate that the region will remain an important source of mined zinc in the medium term.

“South America is of relatively minor importance in terms of global zinc consumption, but increased urbanisation and industrialisation in the region, compounded by its growing middle class, should ensure increased consumption in the medium term,” she says.

“Lead demand in South America is also being boosted by increasing vehicle production and vehicle-user populations, as well as the ongoing roll-out of new third-generation and fourth-generation telecommunications networks,” she explains, adding that Brazil is by far the region’s largest lead consumer and will account for virtually all growth in the region in the medium term.

Matthews concludes that Brazil, the major consuming nation, is at the forefront of South America’s base metals growth, despite its current economic weakness.