Consolidation in copper mining

British mining giant Anglo American and Canadian company Teck Resources have announced a merger agreement that will lead to the creation of a new company called Anglo Teck. The transaction, worth approximately $50 billion, is one of the largest in the mining sector in the last decade.

The main motivation for the merger is to strengthen the companies' position in the market for critical raw materials, especially copper. Copper is becoming a strategic commodity for the current and future shape of the global economy. Electric vehicles, battery storage, transmission systems for renewable energy sources, and digital infrastructure—all of these segments stand or fall on the availability of copper. The newly formed group will have more than 70 percent exposure to this raw material and will rank among the five largest producers in the world. Their merger promises significant synergies, from shared infrastructure to more efficient ore processing. Overall, savings of around $800 million per year are expected within four years of the merger's completion.

From a global economic perspective, this is a sign of continuing consolidation in the mining industry. For Canada, the merger means strengthening its position on the map of global producers of strategic raw materials, while for London it means maintaining its status as a key financial center for the mining business. The merger of Anglo American and Teck Resources is thus not only a corporate agreement, but also a geopolitical event that will affect trade flows, energy investments, and the industrial policies of a number of countries.

In recent months, there have been several significant transactions in the mining industry that confirm the growing pressure for corporate restructuring, specialization, and efficiency. Among the most notable is Teck Resources' decision to divest its metallurgical coal business: most of these assets were acquired by Glencore, moving Teck significantly closer to becoming a pure producer of metals — copper and zinc. There is also speculation about a possible mega-merger between Rio Tinto and Glencore — negotiations are still in the consideration and analysis phase, but if the merger goes ahead, it would create one of the world's largest players in the extraction of copper and other key raw materials for the green transition.