Peru Mining Protests Rattle Markets As Antamina Talks Loom

LIMA: A spate of mining protests in Peru is sending jitters through the Andean country’s markets and raising a test for leftist President Pedro Castillo, who sent officials on Tuesday to the huge Antamina copper mine to defuse a local community blockade.

The world’s no. 2 producer of copper saw its sol currency and equities markets weaken on Tuesday, with traders pointing to the unrest that has hit mines owned by Glencore, BHP Billiton and MMG Ltd in recent weeks.

The country’s largest copper producer Antamina suspended operations on Sunday due to a roadblock established by demonstrators from the rural Aquia community, located about 359 kilometers (223 miles) north of the capital.

Castillo came to power in July on the back of strong support from voters in mining regions, pledging to redistribute mineral wealth to communities who have long complained that they have been left behind in the country’s copper-driven economic boom.

The leader of the Aquia community, which has lambasted Antamina as bringing them “no benefits,” told Reuters in an interview early on Tuesday that the blockade would not be lifted until after talks with the government. He said that the company had never fully paid Aquia for the lands it used, an allegation Antamina has disputed in the past.

Peru’s government said later in the day that the mining minister was leading a delegation heading to the area, some 60 km (37.28 mi) from Antamina, with the aim of launching formal talks to defuse the standoff.

The recent spike in tensions have led industry bodies to decry a “spiral” of protests and saw the industry friendly central bank chief Julio Velarde say the protests were hitting the country’s traditionally strong image as an investment market.

“Obviously order needs to reestablished,” Velarde said on Tuesday as he was sworn in for an additional five-year term.

A currency trader at a Lima bank said the local sol currency was falling on the political backdrop and “really negative news” of suspension of production at Antamina.

The currency weakened 0.43% to above 4 per dollar, while a Lima stock index [.SPBLPSPT] lost around 0.36%.

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