As factories are stilled around the globe because of COVID-19, metals prices have tumbled sharply. But Montana Resources has no current plans to quit mining.
Copper dropped to $2.12 a pound Thursday before bouncing back a little to $2.20 on Friday. Molybdenum was at $8.80 Friday. Last year, copper flirted with $3 a pound, ending with a yearly average of $2.72 and moly was in the $12 range much of the year.
Mike McGivern, Montana Resources' vice president for human resources, said Thursday evening that "we've weathered tougher than this," pointing to 2016 when copper fell well below $2 and moly to around $5.
He said, "We're not making as much as we expected right now, but as long as we can pay the bills and keep our employees, we're happy to be mining. Our trucks, shovels and mills are all running as normal."
Before the pandemic's effects kicked in, worldwide demand for copper was rising rapidly, and McGivern said that pent-up demand after the pandemic has resolved should give prices a boost when industry regains strength.
One of the largest copper mines in the world, Freeport's Cerro Verde mine in Peru, was just shut down by government decree as part of the country's COVID-19 response, as have other Peruvian mines. How long that shutdown will last could have a significant impact on short-term supply. The Cerro Verde mine is capable of producing about 200 million pounds of copper a year, according to company literature.