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- Hudbay has temporarily shut down its Peru Constancia mill amid protests and blockades
- Freeport-McMoRan has declared force majeure at its Grasberg mine in Indonesia after a mudflow incident
- Codelco’s El Teniente mine remains suspended following an underground tunnel collapse earlier this year
- These three disruptions together highlight systemic vulnerability in copper supply chains and upward pressure on prices.
Three of the world’s largest copper projects have been knocked off balance — Grasberg (Freeport), El Teniente (Codelco), and Constancia (Hudbay) — due to a mix of geotechnical disaster and social upheaval. The cumulative effect: tens of thousands of tonnes of copper production at risk.
What’s Going On
Hudbay’s Constancia Mill Shutdown (Peru)
Hudbay Minerals announced the temporary shutdown of its Constancia mill in southern Peru after riots, blockades and protests escalated in the region. The company demobilized non-essential staff to protect safety and used the window to perform preventive maintenance. Management insists the disruption is brief and will not affect 2025 guidance.
Constancia’s role in Hudbay’s copper portfolio is significant; any sustained outage tightens supply margins, especially as other megamines face trouble.
Grasberg: Force Majeure After Mudflow
On September 8, a mudflow inundated parts of the Grasberg Block Cave underground mine in Papua (Indonesia), blocking access routes and trapping workers. Freeport declared force majeure, cut 2025 output guidance, and expects 2026 production to be ~35% below prior estimates. Parts of the mine, such as Big Gossan and DMLZ, may resume in late 2025, but full ramp-up is targeted for 2027. The incident threatens to remove ~250,000–260,000 tonnes of copper from 2025 forecasts.
El Teniente: Codelco’s Ongoing Halt
Codelco suspended operations at its El Teniente mine after a tunnel collapse killed seven miners and rendered key workings unsafe. The stoppage comes amid already strained conditions for Chilean copper output and adds to the “disruption basket” hitting the industry.
Why It Matters
The three disruptions converge at a vulnerable moment for copper markets:
- Supply squeeze intensifies. Goldman Sachs has already cut global mine forecasts after Grasberg’s collapse, estimating a supply loss of 525,000 tonnes through 2026.
- Price pressure rising. Copper prices jumped following Freeport’s announcement.
- Geopolitical/climate risk front and center. Social instability, tunnel collapses, and extreme weather all show no major peer is immune.
- Investment risk grows. Projects with tight margins may delay expansions; downstream supply chains (e.g. copper cathode, wiring, power) could see ripple effects.
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