Chinese-backed mining company MMG has acquired a coveted Botswanan copper mine, owned by Canada-based Cuprous Capital. The high-grade Khoemacau mine is valued at an enterprise value of $1.9 billion, and the deal concludes MMG's long search for copper resources. Despite rising copper prices, China is keen on securing long-term supplies for the green energy transition.

The Khoemacau mine is one of Africa's largest copper deposits, with a flagship project aiming to produce 60,000 tons of copper annually. MMG, headquartered in Australia and listed in Hong Kong, is primarily supported by China Minmetals, a state-owned entity. China's growing copper smelting capacity, set to increase by 45 percent by 2027, reflects its urgent need for more mines amid global competition for copper concentrate.

Supply constraints, including political unrest at Panama's Cobre mine and strikes in Peru, have disrupted copper output, leading to an increase in copper prices. The demand for copper is expected to rise further due to energy transition goals, with renewable energy systems and electric vehicles requiring significant amounts of the metal. China, as the world's largest consumer of copper, is likely to continue driving up prices through state-backed mining efforts to support key industries.

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    For now, China is the world’s largest consumer of copper, using more than half of the total. Expect its state-backed miners to continue bidding up the price of the metal. China is willing to pay top dollar to bolster the competitiveness of key industries.