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Copper is trading at 306 cents per pound following a major earthquake in Chile, the largest copper producing country in the world. It has been reported that copper mines in the region have avoided disruption but some workers have been evacuated.
The majority of copper mines in Chile are constructed to withstand tremors, but traders are worried about the possibility of additional earthquakes and a tsunami.
Extracting the copper is the first step in the process, transporting it out of the county is the next. Even if the mines are left untouched, maintaining the infrastructure is essential to ensure global supply is kept up.
Copper has hit a three-week high on the back of the Chilean earthquake. This has taken the spotlight away from the slowdown in Chinese manufacturing, but that is not to say the People’s Bank of China could not add liquidity to the Chinese banking system.