EXPORTING TO ZAMBIA-MARKET FORCES

EXPORTING TO ZAMBIA-MARKET FORCES

Exporting used DAF Trucks to Africa is a historical formula for Global Commercials Exports Ltd, we are well established and have been trading with the African Continent for decades. Being part of such an evolving Continent it is prudent to keep an eye on the ever changing dynamics of the economies we supply, today I want to talk about Zambia in particular.

Glencore PLC has historically been the second biggest copper producer in Zambia, the Swizz owned mining company announced last month that its halting production at its Mopani Copper Mines as part of a plan to refurbish assets and lower production costs in Zambia. This goes hand in hand with an announcement that it intends to invest $950 Million over the next three years upgrading is production capabilities, expanding to extend the current life projection of the mines. Glencore sits at the very heart of Zambia's mining economy and employees in excess of 10,000 people at Mopani, in addition to the 10,000 mining employees Glencore another 10,000 people work for mining contractors servicing operations.

Worrying times for Zambia's economy and no firm indication, as yet how many permanent employees will lose their jobs though the projection that has been put forward to Zambia's Labour Minister Fackson Shamenda stated last month it was 3,800 jobs. Unfortunately Glencore is not the only mining company that has decided to make radical changes due to market forces, Vedanta Resources PLC Konkola Copper Mines along with CNMC Luanshya Copper Mines PLC will suspend operations a Baluba Mine.

If like me you study these market forces you will have noted that mining companies are cutting copper production after the price of the metal fell 18 percent this year as China's slowing economy cut demand for pipes, wiring and other building materials. Copper hit a six-year low of $2.20 a pound in August, down from a record of about $4.66 in 2011. Those of us that are 'long in the tooth' selling used trucks to Africa will understand that the mining industry is integral to the import of trucks, we supply these trucks that work as the 'work horses' of these industries. So for the time being Zambia is going to be 'moth balled' but not dead I want to make that very clear. Glencore is a monster of a cooperation and has invested an enormous amount of resources into Zambia to walk away, this is clearly defined in there very public announcement of reinvestment so the future for Zambia - it will bounce back but this time will a leaner business model and of course have a voracious appetite for good quality used DAF Trucks.

GLOBAL COMMERCIALS ARE HERE READY FOR ALL YOUR TRUCK REQUIREMENTS CALL ME DIRECTLY JIM BENNETT 01753 831647 OR EMAIL ME DIRECTLY jim@global-commercials.com