Protests disrupt copper mining operations in Peru

Reuters has informed that executives from MMG Limited (Las Bambas) and Hudbay Minerals Inc. (Constancia) recently met with Peru’s Cabinet Chief, Eduardo Arana, raising urgent concerns about ongoing road blockades by informal miners that are threatening copper production at two of the country’s top ten mines.

Supply chains at risk

The Las Bambas (MMG) mine produced over 320,000 metric tons of copper in 2023,Peru’s 4th-largest output, and Constancia (Hudbay) delivered around 99,000 tons, placing it 9th.

Both rely on a major transit route now blocked by protesters demanding an extension of the REINFO program, a temporary initiative to legalize informal mining, slated to end this year. These blockades, active since late June, are impeding the movement of copper-loaded trucks to the coast. While production remains normal for now, companies warn that continued disruption could force operational cutbacks.

„Large vehicles that supply and transport the mineral cannot pass. Both companies are still operating, but they mentioned that if the situation continues for much longer, it could become complicated” said a person close to the meeting.

National and regional impacts

Banco Central de Reserva del Perú – BCRP estimates the July GDP may fall by 0.2% due to logistical disruptions. Moreover, Other regions are also feeling the impact. In Pataz, a major gold-producing zone (40% of the country’s supply), Compañia Minera Poderosa S.A. reported that operations are nearing collapse due to a lack of food and essential supplies.

“The mining companies in Pataz are severely affected. We’re now almost without food and basic supplies to operate,” said Pablo de la Flor, Corporate Affairs Head.

Commitment to dialogue

Eduardo Arana reiterated the state’s commitment to dialogue, however, the statement didn’t offer any specific solutions regarding the protest or its impact on copper output. Authorities continue to signal the end of REINFO by 2025, despite mounting opposition.

Mounting uncertainty

The mining sector now faces mounting uncertainty, with the world’s third-largest copper-producing country at a pivotal moment. The outcome of these protests and the government’s stance on formalization could significantly shape not only Peru’s mining future but also global supply chains.