In Donald Trump’s January Venezuelan adventure that added military substance to last November’s new US national security strategy warning about ‘adversaries’ of the US in South America, there is a special message for the Australian-listed world mining behemoths BHP and RioTinto. It relates to Trump’s strategic concerns about critical minerals supply lines to the US – particularly the copper and rare earths in which South America is richly endowed and of which a secure supply is essential in a modern economy – and for defence.

The multi-billion dollar moves by both companies to seek to make copper their dominant product rather than iron ore brings them onto centre stage in Trump’s ‘it’s our Western Hemisphere’ drama. BHP’s capital expenditure on copper (mainly in Chile, Peru and Argentina) is almost twice that on iron ore, and this year its copper revenues will exceed those from iron ore, while Rio (joint owner with BHP of the world’s biggest producer, Chile’s Escondita, and operator of Utah’s giant Kennecott mine along with a huge copper project in Mongolia) is currently attempting to acquire Glencore to become the world’s biggest miner and a leading copper producer.

With their futures, particularly BHP’s, depending more on North and South America (including the massive multi-billion cost-overrun Canadian potash project), than at home in Australia, they rely not only on Trump’s favourable ‘drill, baby, drill – dig, baby, dig’ investment climate continuing, but on the Australian government remaining a close enough reliable friend for the US to accept Australian-listed companies having control over such critical mineral supply lines. While Trump is in the White House, BHP, for one, remains a multi-billion-dollar investor, with CEO Mike Henry posting on LinkedIn that BHP appreciated the US government’s efforts to boost mining and open new possibilities for development, especially for critical minerals such as copper and potash.

So when President Donald Trump called the CEOs of BHP and Rio Tinto to the White House for a chat last August, there was a powerful and much wider strategic agenda behind his enthusiastic (and already legislated but court-delayed) support for their jointly owned (45/55), lawfare-frustrated, decades-long attempts to develop the US’s biggest potential copper resource – the Resolution Mine in sacred native American land in Arizona, which alone could supply one-quarter of total US copper demand. Following this ‘much appreciated’ supportive meeting, Trump slammed the latest legal setback to their joint plans on his social media post as ‘anti-American’ by ‘a radical left court’, adding in what is a familiar lament in Australia: ‘it’s so sad that radical left activists can do this; we can’t continue to allow this to happen at a time when the US economy needs copper —  NOW!’

January’s Trump-ordered abduction and imprisonment of Venezuela’s anti-American dictatorial socialist President Maduro, with its forceful assertion of US pre-eminence in Latin America, adds a new dimension to the BHP-Rio relationship with Trump. Their major role in what is the world’s leading copper province of Chile, Peru and Bolivia (with BHP also on the way to a huge development in pro-US Argentina), makes these two mining heavyweights subject to Trump’s stated vision of a US-dominated South America where ‘we will deny competitors the ability to own or control strategically vital assets’, with Secretary of State Marco Rubio adding ‘This is our western hemisphere… we are not going to allow it to be a base of operation for adversaries, competitors and rivals of the United States.’

This effective updating of the 200-year-old Monroe Doctrine (which listed any foreign interference in what the US viewed as its Hemisphere as ‘a potentially hostile act’), into what the media has labelled the ‘Donroe Doctrine’ seeks to justify (and warns of) potential US intervention in the Americas on critical minerals supply issues on national-security grounds.

The significance of copper in Trump’s Donroe Doctrine is evident not only from copper’s central role in a modern economy, but in particular from its characterisation  as the ‘strategic bottleneck of the global energy transition’ as demand is increasing exponentially in response to the world’s rapid electrification of energy. Trump’s concern is that the US relies on imports for half of its consumption of refined copper (its inadequate smelter capacity means it has to export concentrate and import refined copper) with inevitable supply-chain risks in a world where prospective production lags way behind expected demand.

So the Trump administration listed copper as a ‘critical mineral’ (along with the rare earths that are the subject of a multi-billion deal with Australia). ‘Strengthening America’s economic and national security requires securing the resources that fuel our way of life and reducing our dependence on foreign adversaries’ reads the critical minerals media release, while last November’s national security strategy stated: ‘The United States must never be dependent on any outside power for core components – from raw materials to parts to finished products – necessary to the nation’s defense or economy. This will require expanding American access to critical minerals and materials.’

Fortunately, the investment climate in this Andean copper belt has shifted in the miners’ favour as the four copper-belt national governments have moved away from socialism and so are not in Trump’s potential firing line. This is particularly so in Argentina, whose free-enterprise, pro-capitalist President Javier Milei (his anti-woke Davos speeches are a delight!), is very close to Trump whose $20-billion financial bail-out of Argentina’s currency crisis ensured Milei’s success at last October’s mid-term election. This has boosted recent international interest, led by BHP’s $US 2-billion initial joint venture  that has applied for approval under Milei’s new investment incentive program aimed at reversing the lack of development in the Peru-Chilean mineral-rich province that had been due to years of Argentinian political instability.

South American governmental responses to Trump’s Venezuela adventure are an indication not only of political leanings, but of potential resistance to the Donroe Doctrine; condemnation came inevitably from the leftist leaders of Brazil, Colombia, Uruguay and Mexico. The backing of Trump by Argentina and Ecuador was endorsed by a New York Times poll showing widespread popular support across South America, with three-quarters of Peruvians and two-thirds of Chileans being in favour of ousting Maduro.

Trump’s cause for concern about foreign adversaries and critical supply lines is self-evident from China’s growing role in Latin America, not just in supplanting the US as the mineral-rich region’s major trading partner but also having 21 countries sign up to China’s Belt and Road initiative. Focussing on infrastructure, China owns a mega-port in Peru as well as a dozen other ports in the region. It has become a leading player in the region’s lithium which presents a major strategic problem for Trump. So does Chile’s and Peru’s ever-increasing flow of unrefined copper to their major market China (no new smelters have been built in Chile for 30-odd years) that fuels China’s world-dominating (and market-controlling) 50 per cent of the world’s refined copper output despite China being a minor ore producer holding only four percent of global copper reserves. So what will Trump do to resolve this multi-billion dollar shortfall of (environmentally unfriendly) refineries that leaves China in control? Pressure his friends BHP and Rio?