Ulaanbaatar/MONTSAME/. Between November 2020, and January 25, 2021, commercial banks issued a total of MNT 99.5 billion in mortgage loans to 1,362 borrowers. Of this, 974 individuals received mortgage loans worth MNT 62.3 billion from the funding source of the Bank of Mongolia, while 388 individuals received the mortgage loans worth MNT 37.2 billion from the banks.

In connection with the financial hardship posed by COVID-19 pandemic, the banks are making deferrals on mortgage loan repayment based on the requests of borrowers. As of January 22, 2021, commercial banks received mortgage loan payment deferral requests from 53,180 borrowers in total and have allowed to postpone the repayment of 52,384 borrowers or about 99 percent of all requests.

Jan. 27 (Xinhua) -- Luvsannamsrai Oyun-Erdene was appointed on Wednesday as Mongolia's prime minister at the proposal of the ruling Mongolian People's Party (MPP).

Oyun-Erdene's appointment was approved by a vote of 87.9 percent in the country's 76-seat unicameral parliament, or the State Great Khural.

Oyun-Erdene, chief cabinet secretary, replaced Ukhnaa Khurelsukh, who resigned and dissolved his entire government at his own request last week after two ministers announced their withdrawal amid social pressure and public protests.

Mass public protests were triggered in the capital city of Ulan Bator last Wednesday after TV footage showed a coronavirus patient who had just given birth being transferred from a maternity hospital to a quarantine facility wearing only hospital pajamas and plastic slippers in freezing weather together with her newborn baby.

Oyun-Erdene, a member of the MPP, has served as a member of parliament since 2016. The 41-year-old became one of the country's youngest prime ministers. Enditem

Ulaanbaatar /MONTSAME/ Scientists of Mongolia and Japan are collaborating on the development of a technology for the restoration of degraded pastureland.

Specifically, the Project titled ‘Restoration of Pastureland by Effective Usage of Wild Forage Plants based on Traditional Knowledge of Nomadic Mongolians’ developed by Mongolian scientists has been selected in an international scientific grant program and a group of Mongolian scientists have begun working together with leading Japanese scientists.

The project is one of the three projects shortlisted from 42 Bio-resources projects that competed for SATREPS (Science and Technology Research Partnership for Sustainable Development) program, implemented by the Japan Science and Technology Agency. Leading scientists at the Mongolian University of Life Sciences (MULS), Institute of Veterinary Medicine, Ecosystem Research Center, the Research Institute of Animal Husbandry, University of Tokyo, Kyoto University, and Tohoku Medical and Pharmaceutical University and the National Agriculture and Food Research Organization and some enterprises of Japan are collaborating in the project led by Professor of the National University of Mongolia J.Batkhuu.

As part of the project, a pastureland restoration technology will be developed through studying climate-resistant, fast growing wild plants beneficial to animal health and introduced into agriculture and veterinary medicine.

A study conducted by the MULS Ecosystem Research Center shows that 22.6 percent or 25 million ha of pastureland in Mongolia has degraded. The project is of great significance as studies and observations conducted over the last 20 years have found that the degraded pastureland cannot restore itself naturally. The project will be implemented for 5 years with annual funding support of MNT 1.4 billion.

As everyone was focused on the fallout from the insurrection at the US Capitol, outgoing US national security advisor Robert O’Brien released a secret document that was supposed to be kept confidential until 2043.

The document reveals how Washington planned to maintain its power in Asia during Trump’s presidency – and in doing so, uncovers opportunities for advancing Mongolia’s interests in Washington, New Delhi, and elsewhere.

Under the objective of promoting the US values, Washington wants Mongolia to “demonstrate [its] own success and the benefits [it] has accrued” through upholding democratic values.

I’ll focus on two points - first, what it means for Mongolia’s relations with Washington, and second, what it says about the winds of power in Asia (and how Mongolia can harness them).

Mongolia’s strategic weathervane for relations with Washington

Taken together, this document is a strategic weathervane for Mongolia. It points to the winds of power – and opportunity.

First, it shows that the US foreign policy establishment is serious about its partnerships in Asia, no matter who is president. This is good news for Mongolia, particularly because Biden’s team includes nominees for senior positions who have been to Mongolia: Tony Blinken, the newly-confirmed Secretary of State, was in Mongolia in 2011 and spoke highly of Mongolian democracy and its partnership with the US; and Jake Sullivan, Biden’s pick for National Security Advisor, appeared in Mongolia alongside then-Secretary of State Hillary Clinton in 2012.

As this new team takes charge, Mongolia could use the opportunity to expand its partnership with the US in ways that won’t threaten its unique role as a diplomatic ‘bridge’ between regional heavyweights like China, India, and Japan.

Trade, for example, has dropped in terms of both imports and exports since a peak in 2012, and there's also a fairly large imbalance; Mongolia imported $193 million worth of goods from the US in 2019, but exported just $25 million worth of goods (although this fluctuates significantly year to year).

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The Third Neighbour Trade Act (if passed) will be a good start to expanding trade relations, but there are other avenues still to explore too. The Generalised System of Preferences (GSP) program removes duties on a long list of products – attracting targeted investment in these areas could promote greater trade with the US. The US House of Representatives recently ‘urged Mongolia’ to take advantage of this program, and also ‘urged’ the US International Development Finance Corporation, a federal body that facilitates and funds private projects abroad, to expand its activities in Mongolia.

Another avenue could be to attract investment in Mongolia’s huge renewable energy resources. There is an incoming wave of support for climate action from the Biden administration, which is re-joining the Paris Agreement and appointing John Kerry (who visited Mongolia too) as the country’s first special climate envoy. So if there are any American companies with expertise in wind and solar energy development thinking of coming to the region, now is the time for Mongolians to knock on their doors - although this would need to be backed up by an inviting business and legislative environment.

Another easy way of staying in Washington’s good books is to show a commitment to values that America finds important. Conveniently, the declassified document specifies exactly what these are: “freedom of navigation and overflight, standards of trade and investment, respect for individual rights and the rule of law.”

Mongolia’s removal from the FATF grey list is a positive step in this direction, as is its forthcoming removal from the EU’s AML/CFT blacklist on February 8. Any efforts to improve the regulatory environment for international business would also be seen as a positive signal in Washington, as would any effort to improve Mongolia’s ranking on the World Press Freedom Index (where it is currently ranked 73rd).

Winds of power from the Indo-Pacific

The document can also be seen as a way of guiding Mongolia’s ‘Third Neighbour’ policy to rebalance decades of partnerships with the US, Japan, EU, India, the Republic of Korea, Turkey, Canada, and Australia.

Mongolia has focused its third neighbor foreign policy more on developed countries. But the country could invest more time and efforts in countries that will soon wield more global influence as a way of sailing with the winds of power, not against them.

The most obvious candidate is clearly India - the largest democracy in the world. The declassified document dedicates a whole page to India - Washington wants New Delhi to ‘expand its economic, defense and diplomatic cooperation with other US partners’, such as Mongolia.

Mongolia already has ancient cultural ties with India through the spread of Buddhism as well as long-standing diplomatic ties. The two countries today share democratic values.

India assisted Mongolia after China imposed tariffs on Mongolian trucks after the Dalai Lama visited a few years ago and is helping build the country’s first oil refinery.

Mongolia is also relying on India to provide a coronavirus vaccine through a recent agreement reached the highest levels of government.

Image from dharmakshethra.com Image from dharmakshethra.com

Image from dharmakshethra.com

There are a few ways Mongolia could expand relations with India, including greater mineral exports to support India’s infrastructure growth. Indian government ministers are clearly keen for steel companies to reduce their dependence on Australian coking coal and have reached out to both Mongolia and Russia as alternative suppliers. Obviously, Mongolia needs to improve its logistics and transport transiting through Russia (probably more costly) or China to access the open sea and reach India.

Military exercises, like one held in 2016, are another option – although these would have to be carefully thought-out given the on-going armed standoff between Indian and Chinese soldiers in the Himalayas.

Mongolia may also benefit from putting more efforts into bringing in Indian IT and solar engineers who offer more affordable solutions and technology than their worldwide peers.

Finally, India may actually provide a healthy counterbalance to Mongolia’s relations with other great powers - both immediate and remote.

So while it would be a good opportunity for Mongolia to use the document as a weathervane for the winds of power, it’s also important to remember that winds can suddenly change.

By: Ewen Levick

US President Joe Biden has warned his Russian counterpart Vladimir Putin about election meddling in their first call, the White House says.

The conversation included a discussion about the ongoing opposition protests in Russia and an extension of the last remaining US-Russia nuclear arms pact.

Mr Putin congratulated the new US president on winning the election, according to a Russian statement.

Both parties said they agreed to maintain contact moving forward.

Former US President Donald Trump was accused by critics of not being forceful enough with Mr Putin. US intelligence officials say Moscow has been involved in several US hacks.

Former President Barack Obama - under whom Mr Biden served as vice-president - was also accused of weakness on Russia, and failing to check the Kremlin as it annexed Crimea, invaded eastern Ukraine and muscled in on Syria.

What did the White House and Kremlin say about the call?

"President Biden made clear that the United States will act firmly in defence of its national interests in response to actions by Russia that harm us or our allies," a US statement said.

A White House readout of Tuesday afternoon's call said that the two presidents also discussed the massive SolarWinds cyber-attack, reports that Russia placed bounties on US soldiers in Afghanistan, and the poisoning of Alexei Navalny.

The Kremlin readout of the call did not refer to any points of friction the White House said Mr Biden had raised.

Russian officials said Mr Putin had "noted that the normalisation of relations between Russia and the United States would meet the interests of both countries and - taking into account their special responsibility for maintaining security and stability in the world - of the entire international community".

"On the whole, the conversation between the leaders of Russia and the United States was of a business-like and frank nature," the Kremlin statement added.

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Biden not looking for a confrontation

Analysis box by Barbara Plett-Usher, State Department correspondent

Joe Biden had indicated he would be tougher on Vladimir Putin than Donald Trump, who refused to take on the Kremlin and frequently cast doubt on Russian interference in the 2016 elections.

On that matter Mr Biden made his sharpest break with Mr Trump, reportedly telling Mr Putin that he knew Russia had tried to meddle in both the 2016 and 2020 elections. He also warned the Russian president that the US was ready to defend itself against cyber-espionage, and any other attacks.

Despite Mr Trump's conciliatory approach, the Kremlin did not benefit from his presidency, because his administration heavily sanctioned Russians for issues ranging from Ukraine to attacks on dissidents. Joe Biden and his foreign policy team will take a robust position on human rights and Mr Putin's intentions in Europe.

But they are not looking for a confrontation.

Rather, they hope to manage relations and co-operate where possible. In that vein, the two presidents did agree to work at completing the extension of the new Start arms control treaty before it expires next month.

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What else did Biden do today?

The call with the Kremlin comes as Mr Biden's nominee for secretary of state, Antony Blinken, was confirmed by the Senate by a vote of 78-22.

Mr Biden later appeared at the White House to sign four executive orders aimed at addressing what he called US systemic racism.

"This is the time to act and it's to act because it's what the core values of this nation call us to do. I believe the vast majority of Democrats, Republicans and Independents share these values and want us to act as well," said Mr Biden.

The president directed the Department of Justice not to renew contracts with private prison operators, though advocates noted the order does not cover privately run immigration detention centres.

Mr Biden also directed the Department of Housing and Urban Development to take steps to eradicate racism from housing policy.

According to the Washington Post, the department will reinstate a 2013 rule on "disparate impact" that aims to block the real estate sector from requiring tenants to undergo criminal background checks, or use artificial intelligence to forecast creditworthiness.

The new orders also recommit the US government to respect tribal sovereignty. The order is not a significant change from existing federal policy, but some Native American tribal officials said their objections to public lands decisions were ignored under the Trump administration.

Mr Biden also signed a directive rejecting coronavirus-related discrimination against the Asian-American and Pacific Islander communities.

Meanwhile, Vice-President Kamala Harris received her second coronavirus vaccine dose at a federal health agency in Washington DC, saying: "I want to urge everyone to take the vaccine when it's your turn."

Ms Harris was criticised during the election campaign after she expressed doubt about the safety of any vaccine that might be developed under Mr Trump. The Moderna drug she was inoculated with on Tuesday was approved by the former Republican president's health officials.

The pandemic has exacted a terrible toll on human life and livelihoods. It is hard to see how anything that could possibly be described as positive could come out of such a devastating crisis.

But the world's biggest money manager suggests there may be one.

Blackrock manages $8.7 trillion dollars of savers' money. It is probably the most influential financial firm in the world.

Larry Fink, the chief executive of Blackrock, in his annual letter to the bosses of all the companies in which that colossal sum is invested, says the pandemic could ultimately help in the fight against an even greater crisis.

"I believe that the pandemic has presented such an existential crisis - such a stark reminder of our fragility - that it has driven us to confront the global threat of climate change more forcefully and to consider how, like the pandemic, it will alter our lives."

Sustainable investments

He argues this is not just talk: you can measure it and that it has accelerated a re-allocation of global capital towards environmentally sustainable businesses.

When the pandemic hit, investors ran to the hills. They dumped their shareholdings and turned them into cash. The Dow Jones index of the biggest companies in the US lost 10,000 points, nearly a third, in a matter of days.

The stock market has rebounded as investors look hopefully to a post-pandemic world - their moods enhanced by enormous amounts of emergency financial drugs such as money printing and massive government borrowing and spending.

But when the investors came out of the hills they came down a different route - investing in different companies than they ones they used to own. Larry Fink notes that investors pumped $288bn globally in sustainable assets, a 96% increase over the whole of 2019.

Climate change to drive 'massive' investment shift

Managing people's money is not a camp fire sing song. You need to deliver results or the pension funds will take their money elsewhere.

Here again, Larry Fink insists you don't have to sacrifice a good return for a clean planet and a clear conscience. The value of companies with better environmental, social and governance profiles increased faster than others during 2020.

A lot of this may be dismissed as "greenwash" - tokenistic attempts on the part of businesses to keep the money coming.

Changing attitudes

It's also true that Blackrock invests hundreds of billions in "index trackers", which mean they will have a holding in a company as long as it is in a big global index - like the FTSE 100, which is chock a block with oil, gas and mining companies from which an independent sustainable investor would recoil.

Some of the sustainable investment outperformance may also be due to it being the new look you have to copy to look current.

However, all businesses go bust unless they go where their customers tell them to go. Last week, the Church of England dumped shares in FTSE stalwart BP despite the new bosses pledges to make the energy company carbon neutral by 2050.

Big UK money managers like Legal & General and Aviva have their own lists of companies they will not invest in, and report that investing attitudes on the part of their customers are moving fast.

It has proved irresistible for governments around the world to promise they will "build back better" - it may also prove hard to resist the yearning to return to what we had before - and if cheap oil for example helps us do that then so be it.

But when the man with the $9 trillion purse strings speaks direct to company chief executives, they tend to listen. And Larry Fink says the pandemic has kicked in a window that was already ajar - a chance for capitalism to reappraise where its headed.

Since the coronavirus emergency began, a year ago, Mongolia has held two successful, in-person elections. While citizens were willing to endure lockdowns, they were also determined to participate in a free, multiparty democracy they are very proud of.

Mongolia is surrounded by its two giant neighbours, China and Russia, one of which is communist, while the other is a flawed democracy, at best. This remarkable fact prompted then US secretary of state John Kerry to dub Mongolia an “oasis of democracy”.

Mongolia declared its independence from China in 1911. It was led by a theocratic leader, on the Tibetan model, the Bogd Khaan, until 1921, when the Mongolian People’s Republic was established. In 1924, the Bogd Khaan died, possibly assassinated by Bolsheviks. The monarchy was abolished, most of the royals were killed, and the country remained a Soviet satellite until the fall of the Soviet Union. In 1990, Mongolia underwent a peaceful transition to democracy. By 1992, the country had a multiparty political system, a constitution, and a free-market economy.

Scoring high

Not only is Mongolia unique, in being the only high-functioning democracy in the region, the Mongolians also score higher on many developmental metrics than do other countries in their income bracket of roughly $4,000 per year. Adult literacy in Mongolia is nearly 99% which puts the country ahead of Saudi Arabia, Malaysia, India, and Pakistan. Mongolia’s Gini, or income disparity measure, is only 3.27, which is quite modest when the US and China both score over 4. The average Mongolian adult has nearly 10 years of formal education, on a par with European countries, such as Greece and Spain, and well ahead of India where the average adult only has 6.9 years of education. Mongolia ranks 106th on Transparency International’s Corruption Perceptions Index, which ties the nation with Brazil. Press freedom is another area where Mongolia has done surprisingly well. Reporters without Borders rank Mongolia at 73rd, well above Israel and Hungary. And in terms of Quality of Democracy, Mongolia ranks 62nd in the world, while Russia ranks 132nd and China 152nd.

Dr Chinburen Jigjidsuren, a special health advisor to the prime minister of Mongolia, was recently elected to the Mongolian parliament, to represent Bayanzürkh district of Ulaanbaatar, the country’s capital. He gave several reasons why he believed democracy in Mongolia was of a better quality than what is seen in China, Russia, or Central Asia.

“First is geography.” he said. “We are located between two giant countries China and Russia. And, we are landlocked.” Mongolians have always fretted that their two hungry neighbors would gobble them up. Southern Mongolia, which has a Mongolian population larger than the country of Mongolia, is now the Chinese Province of Inner Mongolia. Similarly, the Eastern part of Russia contains the Republic of Buryatia, the Tuvan Republic and the Altai Republic, which are home to Mongolic peoples and were once part of the Great Mongol Empire.

Welcome buffer

While fear of annexation is a pervasive feature of Mongolian political life, a free and independent Mongolia also serves as a welcome buffer between China and Russia, two sometimes-allies who do not trust each other very much. If Mongolia were communist, perhaps Russia would be concerned that its allegiance would be with China. Consequently, allowing Mongolia to be a democracy with close ties to its “best third-neighbours”, the US, Japan, and South Korea, helps maintain the balance of power.

“Culturally we are nomadic people,” explained Jigjidsuren. Nomads are fiercely independent people. Americans often think of the early pioneers as independent spirits, who could fend for themselves and needed no help from government. But, unlike the pioneers, who were farmers, nomadic herders are tied to nothing, apart from their animals and their families, not even the land itself. Surveying the Mongolian steppes and watching the expert horsemanship of children as young as three years-old, cowboys are another symbol of freedom which comes to mind. But as free as cowboys were, they were employed by someone to guard the cattle. They had bosses. Traditionally, Mongolians, by contrast, answer only to the big, blue sky. Democracy, rather than totalitarianism, seems a better fit for a people who refuse to be owned.

Best lessons from both

“We are close to Europe and Russia, but we are also Asian,” said the doctor, echoing a sentiment that many other Mongolians have expressed. Mongolia is part of Asia, but has had close ties to Europe, allowing the Mongolians to take many of the best lessons from both. Chinese and Russian medium high schools coexist in Ulaanbaatar, right beside American and British schools. In all of the private and foreign schools, as well as the Mongolian national schools, English is the first foreign language. The average Mongolian is 28 years-old. A significant percentage of the people are internet savvy and speak English.

“Our literacy is high, 90%, and the people are very educated. They access the world through the internet with no restrictions like in China. So, we are free to communicate with the rest of the world,” explained Jigjidsuren proudly, adding: “These are big advantages to build democracy.”

The population is still growing, with more than two children per family. The government provides a great deal of support for children and families, including a monthly stipend paid to parents to encourage more births.

A healthy, young population, which is educated and connected to the internet demands quality and transparency from its elected officials. Facebook is used as a means for young Mongolians to communicate with their elected officials, while it is also used to publicise scandals or the improprieties of public figures. This is helping the country fight bribery and corruption, explained Jigjidsuren “We are becoming more transparent.”

The doctor related Mongolia’s success with democracy to its past refusal to become part of the Soviet Union. “Mongolia was never part of the USSR, because we admire freedom,” he said. “We are a nomadic culture, with a big history, and we had a very difficult time before the communist revolution. We were colonised by the Qing Dynasty for 600 years. So, freedom is very important to us.”

Shortly after this interview, a young, pregnant woman entered a hospital in Ulaanbaatar, where she gave birth. Immediately after the baby was born, it was determined that she had tested positive for Covid-19. She was turned out on the street in minus-25-degree weather, and told to wait for an ambulance which would take her to a special hospital. The story went viral on Mongolian social media and thousands of Mongolians took to the streets to protest her ill-treatment, as well as the coronavirus lockdowns, in general, which have left many with no income for nearly a year.

As a result of the protest, both the vice prime minister and the minister of health resigned. Bat Purev, former director general of the Financial Regulatory Commission of Mongolia, observed: “Mistreatment towards a newborn and mother who tested positive for Covid ignited people’s anger and frustration. So, the youth just went to the street without any organisation, except social media. That made the deputy prime minister and health minister write their resignation letters. That wasn’t the end, though. Today, the prime minister also decided to go!”

The pride that he felt for his countrymen and for a democracy that allowed citizens to hold their elected officials accountable was evident when he concluded: “It is quite beautiful to see how a new generation of Mongolians, with a dedicated sense of human rights is growing. And yes, Mongolia is still a jewel of democracy in the region.”

By: The author, Dr. Antonio Graceffo PhD China-MBA, worked as an economics researcher and university professor in China, but is now living in Ulaanbaatar, writing about the Mongolian and Chinese economies. He holds a PhD from Shanghai University of Sport Wushu Department where he wrote his dissertation “A Cross Cultural Comparison of Chinese and Western Wrestling” in Chinese. He is the author of 11 books, including A Deeper Look at the Chinese Economy, The Wrestler’s Dissertation, and Warrior Odyssey. He completed post-doctoral studies in economics at Shanghai University, specializing in US-China Trade, China’s Belt and Road Initiative, and Trump-China economics. His China economic reports are featured regularly in The Foreign Policy Journal and published in Chinese at The Shanghai Institute of American Studies, a Chinese government think tank.

The deadly coronavirus has taken a heavy toll on the world’s copper mines.

Output in key producer countries such as Peru cratered over the second quarter of 2020 as lockdowns and quarantine measures caused many mines drastically to reduce operations.

Recovery has been patchy. Peruvian mines had just about returned to normal run-rates by October, but output in Chile, the world’s largest copper producer, started sliding in the third quarter after a robust first half of the year.

Global mine output in the first 10 months of 2020 was still 0.5% lower than 2019 levels, according to the International Copper Study Group (ICSG).

What was supposed to be a year of mined supply growth turned out to be the second consecutive year of zero growth.

The resulting supply chain stress is manifest in this year’s benchmark smelter terms which are the lowest in a decade.

There is as yet no sign of a turnaround in the raw materials segment of the copper supply chain, suggesting full covid-19 recovery could be a protracted affair.

Falling benchmark

Treatment and refining charges, which are what a smelter levies for processing copper concentrates into refined metal, are the best indicator of what is going on in the opaque raw materials market.

And the message is clear. There’s not enough concentrate to go around.

The benchmark terms for this year’s shipments fell to $59.50 per tonne and 5.95 cents per pound from what was already a lowball $62.00 and 6.2 cents in 2019. They haven’t been this low since 2011, another year of mine supply stress, when they were settled at $56.00 and 5.6 cents.

Last year’s supply woes coincided with increased appetite in China as new smelters entered the competition for raw materials.

That should have translated into more concentrates imports. But after increases of 14% and 12% in 2018 and 2019 respectively, imports were down by 1% over the first 11 months of 2020 as smelters struggled to source material.

Unless there was a big rebound in December itself, 2020 could be the first year of lower concentrates arrivals since 2011.

An unofficial ban on Australian material hasn’t helped. Strained bilateral relations between Australia and China have impacted Chinese purchases of copper concentrates, which fell to zero in December.

However, Australia was only the fifth-largest supplier to China in 2019 and although constricted trade has exacerbated the tightness, the root cause has been covid-19 disruption, particularly in Peru.

What is normally China’s second top supplier after Chile saw mined copper production contract by 38% over April and May and by 14.5% over the January-October period, according to the ICSG.

Smelter squeeze

There is no sign of any short-term alleviation of the squeeze on smelter margins.

Indeed, it may be getting worse.

China’s Smelter Purchase Team, a grouping of some of the country’s biggest players, has lowered its floor purchase terms to $53.00 and 5.3 cents for the first quarter.

The Team has considerable negotiating muscle and its quarterly minimum terms are a strong signal as to the state of play in the concentrates market.

This quarter’s floor terms are down from $58.00 and 5.8 cents in the fourth quarter and from $67.00 and 6.7 cents in the first quarter of 2020.

Even this low first-quarter floor may be on the optimistic side, since Fastmarkets is assessing the spot market for copper concentrates at below $50.00 and 5 cents.

Quite evidently, copper mine production still has a way to go before satisfying smelter demand.

Long recovery?

Supply should improve as mine activity normalises along with everything else in the wake of covid-19 vaccination programs.

The ICSG’s October forecast was for world mined copper production to fall by 1.5% in 2020 but to come roaring back with 4.6% growth in 2021.

Things, however, may not be that simple.

Consider the case of the Las Bambas mine in Peru. Production last year was 311,000 tonnes of copper in concentrate, according to mine operator MMG Ltd.

The mine took a 70,000-tonne hit from a combination of COVID-19 restrictions on personnel, unplanned maintenance and, to a lesser degree, community road blockages.

Production recovered to pre-pandemic rates in the fourth quarter with onsite workforce levels “now in excess of 90% of normal, with expanded COVID safe accommodation options available at site and in local communities,” MMG said,

But last year’s disruption will have a long tail.

It was supposed to be “a year of transition for Las Bambas, with an intended focus on continuing to increase mining volumes to open up additional operating faces, completion of the third ball mill and the development of the (new) Chalcobamba pit.”

Most of that activity will now fall into this year “with a return to higher production volumes in following years,” according to MMG. Production in 2021 is expected to come in close to 2020 levels at 310,000-330,000 tonnes of contained copper before rising to 400,000 tonnes in subsequent years.

Although Las Bambas like other mines has learned to live with COVID-19, it has done so at the cost of deferring expansion work.

Long covid-19

When copper smelter terms were last this low – 2010 and 2011 – the copper price was at record highs.

That was no coincidence. The world’s miners were collectively blindsided by the strength of China’s demand for industrial metals. Their inability to respond saw tightness in the concentrates segment of the supply chain transmitted into the refined metal section.

With Chinese demand again booming and analysts looking for a strong pick-up in demand from the rest of the world on the back of “green” technology roll-out, copper mine supply needs to react.

However, if Las Bambas is indicative of operational stresses in the rest of the sector, production is not going to miraculously snap back to pre-pandemic levels this year.

Just as the world starts to consider the effects of “long COVID-19” on human health, the copper market needs to start doing the same for mine supply.

(Editing by David Evans)

Ulaanbaatar /MONTSAME/ The Government of Mongolia is urging the Oyu Tolgoi project investors to revise the Oyu Tolgoi Investment Agreement signed in 2009 and terminate the Oyu Tolgoi Underground Mine Development and Financing Plan, known as ‘Dubai Agreement’, according to the statements made by Acting Minister of Justice and Home Affairs Kh.Nyambaatar and Deputy Chief of Cabinet Secretary B.Solongoo, when they today met Member of the Parliament S.Ganbaatar, who has gone on hunger strike, demanding Oyu Tolgoi agreement termination.

Acting Minister Kh.Nyambaatar said, “ We have received Oyu Tolgoi Project Financial Model 2029. Oyu Tolgoi project sales revenue is projected to increase when the underground mine operations begin in 2023 and reach USD 29 billion by 2029. According to the financial model, USD 10 billion of that sales revenue will cover operational costs. USD 12 billion out of the remaining USD 19 billion is reported to be written off for the depreciation. Per the model, we will have to pay USD 3 billion in loan after the remaining USD 6.3 billion is used for the repayment of the investment. Therefore, actions are being taken in phases to have experts conduct an independent review and determine the legal framework for the agreement termination.”

“The working group in charge of the agreement revision has successfully convened several times. During its talks with Rio Tinto executives on December 18, 2020, the working group urged them to terminate the Dubai Agreement and completely revise the 2009 Investment Agreement rather than improving it. January 18 saw a virtual meeting with the investor side where it was stated that the Investment Agreement may be terminated as a last resort if the Mongolian Government’s demand is not accepted. To make the project beneficial to Mongolia, the government is ready to work with MP S.Ganbaatar and have him join the working group.”

Cabinet Secretariat Deputy Chief B.Solongoo said, “The Government imposed a MNT 350 billion tax penalty on Oyu Tolgoi LLC in 2018 and a MNT 650 billion tax penalty in 2020. The company refused to make the payment and took the case to an international court. The Government of Mongolia must file an answer to the court within February 21, 2021. We are working to give a reasonable answer. The extensive working group set up by the Government is working with three sub-groups”

As the second largest landlocked country in the world after Kazakhstan, Mongolia has a very distinctive climate. Just like neighbouring areas such as southern Russia to the north and northern China to the south, Mongolia’s climate is characterised as continental, as opposed to the maritime climate of locations closer to the sea or ocean.

In practice, this means long and very cold winters, with average temperatures in the capital, Ulaanbaatar, staying well below freezing from November through to March, and reaching lows of almost -50C. In contrast, summer temperatures are in the low 20s, and can reach peaks of 36C.

Precipitation in the capital is almost nonexistent in winter, with virtually no snow. In the summer months, from June onwards, there is a small amount of rainfall, but the annual total here is just 200mm (less than 8ins).

Most of the country is covered with desert plains (in the south) and steppe grasslands (in the north and east, where there is a slightly higher rainfall). But in the west and north, mountain ranges rise to over 3,000 metres (roughly 10,000ft). The peaks are often covered with a light dusting of snow, and occasionally there is a heavier fall.