DR Congo State Miner Increases Copper Commitment to US to 500,000 Tonnes

DR Congo's state-owned mining company Gécamines has committed 500,000 tonnes of copper for sale to the US, according to a sovereign debt prospectus filed in London last week. This amount is five times the volume previously announced in January. The pledge is channeled through Gécamines' joint venture with Swiss commodities trading company Mercuria.

The joint venture focuses on converting Gécamines' minority stakes in major DR Congo mines into physical copper for sale. These stakes include operations at the Kamoto Copper Company, run by Glencore, and the Tenke Fungurume mine, operated by Chinese interests and holding one of the world's largest high-grade copper-cobalt deposits.

The increased volume reflects the growth of the venture since its inception.

State-backed trading vehicles are appearing in Africa's Copperbelt region, where governments seek greater influence over commodity transactions. Zambia's Industrial Development Corporation established a similar structure with Mercuria a year earlier. This approach remains uncommon in the mining sector compared to oil and gas.

Joint Venture Gécamines stated in December that the partnership with Mercuria provides greater visibility and control over its holdings.

The arrangement allows for more strategic direction of copper volumes. Currently, trading occurs through Mercuria, as Gécamines lacks the legal entity to sell directly. People familiar with the arrangement reported that Mercuria acts as the seller of record.

Kinshasa aims to develop a Gécamines trading arm to handle sales in the future. Building such capabilities requires global connections, offices, financing, insurance, and risk management.

The US relies on offtake agreements and state-backed funding to secure access to African minerals, including in DR Congo.

This strategy addresses competition for resources in the region. The increased commitment could affect global supply chains for copper, a critical metal for electrification and technology.

Stakeholders in the mining sector monitor these developments for their implications on pricing and availability. Further details on implementation may emerge as the venture progresses.