Chile is optimistic that a deal to end the ongoing trade dispute between China and the US is close at hand, lending to support the price of copper, the country's principle export, Mines Minister Baldo Prokuric said Friday.
No-one has a crystal ball to know when they could reach agreement but the reports suggest that we are closer to a deal than the trade war continuing," the minister said.
Chile is the world's largest exporter of copper, producing 5.8 million mt last year.
Copper prices have recovered sharply in recent days, reaching their highest level since last July after US President Donald Trump said earlier this week that talks between US and Chinese officials were "going very well." Trump is expected to meet with China's Vice Premier Liu He later Friday in the White House as the two sides hurry to reach a deal before a March 2 deadline which could see US tariffs double on $200 billion worth of Chinese imports.
Copper prices fell by around 20% between last June and the start of this year after the US slammed tariffs on Chinese imports, sparking reciprocal measures from Beijing and raising fears of a prolonged slump in global trade and a drop in Chinese investment levels.
"The international copper price today reflects not global supply and demand, but the effects of the trade between the US and China," the minister said.
Recent reports that a deal could be close at hand supported the Chilean government's forecast that the copper price will average $3.05/lb during this year, up from just under 2.96/lb in 2018, the minister said.
