Business & Finance: Copper’s Travail

With copper last week being sold by custom smelters at 7⅜¢ a pound, another all-time low, the already painful pinch upon U. S. producers became sharper than ever. Therefore last week Quincy Mining Co. shut down its mines for five weeks and Magma Copper Co. shut down for three months. Adding United Verde and United Verde Extension, both of which shut down several weeks ago, this made four copper companies out of business. In 1929, the four supplied 12% of total U. S. production. Should copper fail to rise in the near future, other of the lesser companies are expected to join these four. Such a development is known as Little Fellows Being Squeezed Out after a long period of overproduction. The exit of Quincy and its fellows is less significant than it might be for all U. S. copper producers are shut down to a greater or less extent at the moment. Present prices are too low to tempt much production activity. Copper men viewed with reluctance the suggestion made at Washington that they market their product at its present price in Germany on credit (see p. 11).

Cheap copper has no terrors for the great Mid-African mines of the Union Minière du Haut Katanga, world’s biggest producer. At the company’s annual meeting in Brussels last week. President Jean Jadot stated that his company can make money on 8¢ or even 7½¢ copper. Katanga’s 1930 earnings were 270,208,000 Belgian francs ($7,511,000), only about 6,000,000 francs down from the peak earnings of 1929. Elements in Katanga’s strength are: tremendously rich ores; cheap native labor; big production of cobalt and radium (over 82%, of world radium supply) on the side; and, most recent, the newly opened Benguela Railway, which connects Katanga with the Atlantic, saves hundreds of rail miles, thousands of sea miles for Katanga copper on its long journey to European markets.