The global mining industry is grappling with uncertainty as the United States’ protectionist trade measures cast a shadow over investment decisions. At the recent Investing in African Mining Indaba in Cape Town, Richard Horrocks-Taylor, Standard Chartered Bank’s global head for metals and mining. He warned that these policies could delay critical projects needed to address growing supply gaps.
“Trade policy uncertainty will create an environment where capital hesitates,” Horrocks-Taylor said during the conference. The new U.S. tariffs announced recently may trigger economic shocks and spark inflation, further complicating the investment landscape.
Despite this, long-term trends remain optimistic. Demand for base metals such as copper and Aluminium is expected to rise due to Electrification, renewable energy initiatives, and global infrastructure spending. For instance, Copper prices are forecast to average $9,900 per tonne this year. While Aluminium could see a 10% increase over the next three years. However, the threats of U.S tariffs are overshadowing the positive fundamentals, making investors more cautious about committing capital to mining projects.
Macroeconomic Risks Delaying Investments in Africa
A panel discussion at the conference, featuring representatives from major trading houses like Mercuria Energy Trading pointed to the need for clear and stable trade guidelines. These experts highlighted how macroeconomic risks are delaying mining investments across Africa. This trend could exacerbate existing supply shortages as global demand continues to grow. Hence, potentially robbing the continent of much-needed economic opportunities.
Africa is rich in mineral resources. However, without adequate investment, it risks missing out on the benefits of rising metal prices. Policymakers were urged to provide clarity and stability in trade policies to encourage investor confidence and accelerate project development.
On another note, Philip Clegg, the managing partner at Orion Resources Partners, reported about the status of Africa’s mining industry. The manager claims that the mining sector is at a critical juncture. Philip said:” The long-term outlook for Copper and other electrification metals remains strong, yet near-term policy uncertainly could slow down investments needed to meet future supply,” during a packed conference session on commodities.
