American Resources Policy Network
Promoting the development of American mineral resources.
  • Blog

  • HOMEPAGE >> BLOG >> Through the Gateway: The Copper Gap That Needn’t Be

Through the Gateway: The Copper Gap That Needn’t Be

Lately, web searches for “Copper” have seemed to turn up stories about the metal’s woes on the global commodity market on a daily basis.  Like many of its hard-rock commodity peers, Copper has seen its price decline over the past five years.

However, there is good reason to believe that the self-corrective nature of commodity cycles will take hold, and Copper fundamentals remain strong, particularly as Copper, which as we have pointed out, is far more than an “old school” industrial mainstay metal and in fact may well be dubbed the “Gateway to Renewable Energy.”

It is important to note that the current global copper oversupply does not translate into a Copper surplus in the United States – according to the latest USGS Mineral Commodities Summaries, we still import 36% of the Copper we consume.

That wasn’t always the case. As ARPN’s Dan McGroarty has pointed out:

“American policymakers once treated copper as a strategic metal.  It was held in the National Defense Stockpile during the Cold War.  When the Soviet Union imploded two decades ago, the U.S. produced 93 percent of the copper we consumed.  Copper was sold out of the stockpile – which today stands at zero.  In the past 20 years, copper imports have increased five-fold, to 35 percent.

In other words, we’ve gone from a situation of near self-sufficiency to a shortfall of more than 600,000 tons per year – demand that must be met by imports.”

A similar scenario has unfolded for many other metals and minerals, and in many cases, needlessly so, as the United States has significant known mineral resources with an estimated net worth of $6.2 trillion beneath our own soil.  With estimated reserves of 33 million metric tons of Copper, the United States is well positioned to close the Copper Gap – a move that would be beneficial on several levels:

“Indeed, American miners could help the U.S. become a copper exporter – just as American farmers feed the world.  American alternative energy manufacturers, seeking to build wind turbines and solar panels, would enjoy sources of selenium and tellurium here in the U.S.”

However, a number of policy hurdles – among them chiefly a rigid and outdated permitting process for domestic mining projects – stand in the way of such a development.

In the long term, we can expect commodity prices to pick up again. While we wait for the long term to arrive, the prudent course of action would be to tackle these policy obstacles head on.

We will be looking at some of these issues, as well as current efforts and policy prescriptions in more detail in separate posts.  In the meantime, our focus will shift to Copper’s co-products, many of which have become critical tech metals in their own right.