Elements of Logistics: Along the Line of Copper

Elements of Logistics: Along the Line of Copper

Elements of Logistics: Along the Line of Copper

500 377 Giorgio Grappi and Brett Neilson

Examining the conduits of production and circulation that link the extraction of copper in Chile to its storage and use in China, this article explores the political dimensions of the logistical technique sand technologies that enable these processes. We approach copper as a material element that due to its capacity to conduct electricity provides conditions of possibility for contemporary digital capitalism. At the same time, we consider the elements that constitute logistics as a political forceby asking how logistics operates in parallel, partnership, and rivalry to forms of state and international order themselves in uncertain transformation. Empirically, the article stems from research conducted in Chile, specifically in the port of Valparaıso, the Andina mine run by the country’s state owned copper mining company CODELCO, and the copper smelter run by the same company on the coast at Ventanas. On this basis, we ask how the production and circulation of copper has mutated with shifting logistical arrangements that respond to the geopolitical position of China, the financialization of trade in base metals, the rise of business models based in data extraction, and workers’ struggles in times of labor precarization.

Keywords: Logistics, extraction, copper, Chile, China, labor

Extracted from hard rocks and mountains, copper is a tradable metal that occupies a place on the fourth row of the periodic table. Known for its capacity to conduct electricity, the element has become an indispensable component in the manufacture of computing hard-ware and other equipment essential to today’s capitalism. The theme of the elemental has proved alluring in recent critical discussion “because it both captures something tangible about the world and also remains excessive of human agency or intervention” (Engelmannand McCormack, 2018: 242). Yet, as we show in the case of copper, elements are not simply given. While they provide a kind of material limit to chemical processes of reduction and synthesis, their ontic existence frequently betrays their pure form. This is certainly the case for copper, which occurs most commonly in oxidized states or mixed with other elements. Our effort is to situate copper in its contemporary conduits of production and circulation and, in particular, within the patterns of mining, refinement, transportation, and stockpiling that link its extraction in Chile – the world’s primary copper producing country – to its storage and uses in China – the world’s largest copper importing nation. In this sense, we approach copper as an element of logistics, emphasizing the techniques and technologies that enable its extraction and production as a commodity as well as the articulation of these logistical operations to geopolitical and economic transformations. The article draws analytical attention to the relation between logistics, finance, and capitalist forms of extraction in both their literal and wider senses. We trace how the production and circulation of copper has mutated with shifting logistical arrangements that respond to the geopolitical position of China, the financialization of trade in base metals, the rise of business models based in data extraction, and workers’ struggles in times of labor precarization. On this basis, we ask what type of politics logistical practices related to the contemporary copper industry embody.

Given the historical and symbolic role of copper in the forging of Chilean modernity, an investigation of these changes in production and circulation offers the opportunity to explore how logistics operates in parallel, partnership, and rivalry to forms of state and international order themselves in uncertain transformation. Because the Chilean economy has been historically dependent on copper exports – a dependence even more pronounced since the 1970s – the logistical coordination of copper extraction and processing has produced governance tools that synchronize administrative times, procedures, and standards across diverse institutional environments and geographical scales. The Chilean state has become logistics-friendly. At the same time, the technicalities of copper extraction and export have allowed logistical processes to shape priorities and reforms within domains that were part of the state’s sovereign capacity. In investigating these political dimensions of logistics, our inquiry aims to be more than a work of economic geography or commodity chain analysis. We do not emphasize the actors and value-adding processes at work across different links of a production network. Indeed, our observations and theoretical speculations stem from limited empirical research conducted in Chile as part of a project called Logistical Worlds (http://logisticalwolrds.org), particularly in the port of Valparaıso, the Andina mine run by the country’s state owned copper mining company CODELCO, and the copper smelter run by the same company on the coast at Ventanas (see Figure 1).

Figure 1. Copper concentrate stored at Ventanas smelter.

While we share with commodity chain analysts a concern with the exercise of power in production processes, our interest is more specifically in the role of logistical operations in the coordination and execution of these processes. In particular, our concern is with the relevance of logistical operations in a situation where scenarios of financialization affect the industry’s trajectories in ways that make transactions occurring at specific links along the chain no longer the primary determinants of the commodity’s value. As it becomes clear in the following analysis, futures trading and stockpiling have become no less important insetting the price of copper than value adding practices along different links of the commodity chain itself. To distinguish our analysis from the commodity chain approach, we thus use the term line of copper. The word line is not meant to limit us to a two-dimensional topology or to exclude the analysis of other topographical and spatial features associated with copper production, such as the use of zoning technologies. Indeed, the term carries the meaning of both a threshold and a connecting logic. The line of copper is for us the expression of the movement between the economic and the political that characterizes the relationship between copper as an element and the elements that constitute logistics as political force.

We examine the line of copper by tracing the historical importance of this commodity to Chilean modernity and the wider mutations of political power at stake in interactions between logistical practices and the formally constituted state. This investigation leads us to consider of the role of software and data analysis in practices of mine automation and mineral processing that convert copper ore into concentrate and then into cathodes. Cathodes are highly pure sheets of copper ready for export and use in a variety of applications, including the manufacture of the computing hardware that makes the global logistics industries tick. By examining the toxic consequences of these processes of copper extraction and refinement as well as their implications for labor, we show how the study of logistics can move between environmental concerns and an investigation of labor processes and relations – questions that in contemporary theoretical debate are often consigned to different and irreconcilable ontological realms.

Throughout the study, we observe the tight relations between logistical operations and those of finance on the one hand and the literal extraction of copper on the other. The emphasis on advanced practices of logistical coordination in the Chilean copper line also exhibits how these operations extend toward expanded vistas of extraction (Mezzadra and Neilson, 2017), based on the generation and analysis of data. If the continuation of labor unrest in the copper sector, especially among contract workers, symptomizes both the pressures driving this logistical turn and those created by it, it is also important to remember that these changes occur within constraints that compel us to reconsider geopolitical factors in relation to operations of capital. Thinking about copper simultaneously as a material element and as an element of logistics means asking how copper enters into logistical operations and how logistical operations in turn change the meaning of copper. In this way, copper and the specificity of the Chilean experience help us to illuminate how logistics works in relation to the economic, the operational, and the political.

El sueldo de Chile

The history of copper mining in Chile places emphasis on the dynamics of extraction and their relation to class formation and state strategies of making capitalist modernity (see, for instance, Clark, 2013; Salazar, 2003). Indeed, current Latin American debates concerning “developmentalist neo-extractivism” (Svampa, 2015) extend these concerns, launching a critique of state strategies pursued by the region’s “progressive” governments, which seek to fund social programs with rents derived from resource extraction. Some recent studies emphasize how spatial, urban, and infrastructural designs facilitate resource extraction in ways that resonate with our interest in logistics (see, for instance, Correa, 2015). Overall, however, debate has been surprisingly inattentive to the continuities and disruptions that link resource extraction to the data extraction that animates activities in the financial and logistical spheres (Gago and Mezzadra, 2015). It is important to keep this trajectory in mind as we historically situate the material and symbolic role of copper in the construction of Chilean capitalist modernity. Such an approach means paying attention not only to nation-ally based processes of class formation but also to the centrality of copper exports to the extraordinary neoliberal experiment conducted in Chile from the 1970s.

Since pre-Columbian times the search for mineral-rich lands has affected the political geography of Latin America, while in the colonial era Chile was one of the sources for the accumulation of valuable metals, including gold and silver, which were integral to early modern formations of finance and global trade. The race for metals and minerals such as potassium nitrate also marked the history of independent Chile, including an event that still casts its shadow on present tensions over connectivity with Bolivia, the Pacific War of1879–1884 during which Chile took over rich salt mining districts from Peru and Bolivia in the region of Atacama. With the discovery of electromagnetic induction in the early 19th-century, industry paved the way for copper to become one of the world’s most wanted metals, a change that eventually led to the partial abandonment of old mines and a new wave of copper mining in the 20th-century. In this context, the mining industry in Chile turned to copper extraction, an old business that eventually reached an unprecedented scale, making the country the world’s largest producer of copper concentrates. An intertwining of economic, technical, and political rationales thus led to the present role of copper in the global supply chain and the Chilean state.

Anticipating some aspects of the current debate on neo-extractivism, Salvador Allende proudly located nationalization and copper mining at the core of the socialist project, arguing that “the future of our country depends on it” (quoted in Vergara, 2008: 158). After “a fifty-year history of increasing state dependence on the mining industry and incomplete attempts to reduce, or at least control, the power of foreign capital”, the nationalization of the copper industry was the most durable reform introduced by the Popular Unity socialist government in 1971 (p. 158). In this period, copper was dubbed “the wage of Chile”(el sueldo de Chile) and ownership of the country’s mines was transferred to CODELCO, the Copper Corporation of Chile, which become one of the major entities to finance public programs, to the extent that copper production was “critical to the success of the revolutionary government” (p. 158).

After the murderous coup of Augusto Pinochet, the junta militar proceeded with a reorganization of the sector. In 1976, CODELCO became the National Copper Corporation of Chile, without reversing nationalization. In an attempt to undermine union power, CODELCO followed an agenda of efficiency and competitiveness based on “increased mechanization and outsourcing, and externalized services such as health care and education”. In this context, “the labor force became smaller and more skilled, and the proportion of contract workers higher” (Vergara, 2008: 187). During this period, the government opened concessions to multinational corporations, allowing them to search for and mine copper under article 24 of the Chilean constitution, which the junta adopted in 1980. This move eventually led to the coexistence of state and privately owned mines. We observed such coexistence during the Logistical Worlds visit to CODELCO Andina, a high mountain copper mine in the Rio Blanco valley less than 100 km from Santiago and adjacent to the AngloAmerican mine Los Bronces. State and privately owned mines these days virtually overlap as they extract rocks from the same lodes just a few meters away from each other,operating in very similar conditions, adopting similar techniques, and facing similar problems (see Figure 2).

Figure 2. AngloAmerican’s Los Bronces seen from the top of CODELCO’s Andina mine, 4200 m.

In a book entitled Civilización y cobre, CODELCO (2001: 59) describes copper as an“essential and unique part of new technologies associated with modern life.” The book concludes that this situation will secure a “growing and persistent demand of [Chile’s]main export product” (p. 59, our translation). But the historical record shows that geopolitical and market factors have dented this confidence. Following nationalization, legal conflicts with former mine owners Anaconda and Kennecott undermined the capacity of the country to sell copper in international markets (Vergara, 2008: 158). By the time of the junta, price fluctuations had become the main concern. The year 1987 saw the formation of the Copper Compensation Fund, which was designed to stabilize cash flow from copper production and subsequently became part of the Economic and Social Stabilization Fund, a “counter cyclical tool that aims to smooth out government expenditures” in times of low growth or low copper prices (National Resource Funds, 2013). More recently, the rise in the global demand for copper has not always resulted in higher demands for Chile and, most notably, in the production of higher value by the country’s mining industry. Data show that 40% of mining projects that have obtained environmental approval in Chile remain unexecuted because the unstable price of copper troubles mining companies (Vargas, 2017). The depreciation of copper has made unprofitable projects that were considered profitable just a few years ago. This situation coincides with the changed geological dimension of active mines, where the richest minerals are becoming depleted, resulting in an increase in production costs. Even if a recovery has been forecast in the near future, it seems obvious that a purely extractivist agenda has become insufficient and even unprofitable.

Reading the history of Chilean copper production through the lens of logistics brings into focus the relation between economic practices and political form, emphasizing the role of the state before, during, and after the extraordinary experiment in neoliberalization conducted under the Pinochet regime. In particular, the Chilean case shows how the familiar reading of neoliberalization as state withdrawal from the orchestration of society and markets does not apply as the nationalization of the copper industry was coincident with its logistical organization. At the same time, logistical modes of coordination crept into state logics and actions, subjecting them to economic rationales and technocratic imperatives. Although these rationales and imperatives were in many ways depoliticizing, they also articulated strongly to a political program of development that abandoned strategies of import-substitution industrialization and looked for growth in export industries such as mining and commercial agriculture (Connell and Dados, 2014). Logistical practices of organization thus became central to the neoliberal project of securing political legitimacy through economic growth, even if they were themselves lacking in legitimacy. This meant that state-sponsored extractivist projects became increasingly inseparable from market dynamics in which issues of finance, transportation, coordination across sites, and the circulation of information were crucial to ensuring profitability across a range of political and economic transformations. If the elemental properties of copper as an electrical conductor make it the circulating medium par excellence, indispensable to the wiring of the world even in the age of fiber optics, the elements of logistics that underlie and enable its production and circulation not only have their own history but also make copper crucial to their conditions of possibility. Although myriad elements and commodities play a role in such historical and technical transformations, it is no exaggeration to say that there is no copper without logistics and no logistics without copper.

The line of copper

The debates, practices, and discourses we encountered during our in situ research mark changes in the social value of copper and its relation to logistics: from an asset to a symbolic value and then a site of experimentation. Beyond copper per se what counts are logistics and technologies tested across operations. Here we found a relevant and often over looked dimension of logistics. Rather than simply concerning the sphere of production and circulation, logistics becomes a testbed upon which, in the name of technical optimization,environments and social relations are changed and forged in new ways.

These dimensions of logistics become most visible at the start and end points of the copper supply chain in Chile: the mines and the ports. In both these sites, optimization,the creation of zones, and experimentation with automated and “smart” forms of organizing labor and operations become the core of future developments and the key to their profit-ability (see Figure 3). Ports like Valparaıso or mines like Andina thus become, as we were told during one of our meetings, “natural labs for frontier activities” that can ideally be extended beyond the specific sites of the port and the mine. Drawing attention to infra-structural connections between ports, global commodity corridors, and operations along the copper line forced us to make sense of the way in which logistics permeates and transforms the relation of Chile with its main industry.

Figure 3. Real time monitoring of machine activity at Andina mine.

An opinion column published in the national newspaper El Mercurio at the time of the Logistical Worlds research urges that “beyond the fluctuations of copper price, Chile must explore the future scenarios opened by technological transformation and grasp on time the new opportunities” (Bitar and Valenzuela, 2015, our translation). A sort of logistics revolution for copper presents itself as the only path for Chilean mining, where environmental sustainability, optimization and big data are keys to overcome the present orientation towards rentier extraction. This change requires a national agreement where digitalized governance and performance indicators substitute for the traditional pride of a country“married to copper” (Kleinschmidt, 2014). Left aside in this perspective is labor and, more precisely, the reaction of workers to this projected shift.

We visited the Centre for Mathematical Modelling (CMM) at the University of Chile in Santiago, where engineers and mathematicians work in conjunction with CODELCO to remodel the mining industry. CMM is far from any mine, but here visual software and a supercomputer operate to study the future of “smart mining.” In a practical realization of the dynamics of computing and power mapped by critics such as Benjamin Bratton (2015)and Ned Rossiter (2016), CMM’s work of software optimization responds to needs of governance and control that span different levels or layers of operation, from the environmental to the user-oriented. These needs include forecasting the behavior of rocks during simulated earthquakes, real time analysis and elaboration of the composition of the “blocks” into which the mine is divided for logistical purposes, coordination of movements and tasks inside the mine, and integrated optimization of the entire operations flow. Initiatives include the formation of mobile hubs for data transmission that transform machines and human bodies into mobile infrastructure for operating an integrated network in the difficult environment of isolated Andean valleys.

Engineers at CMM present workers as co-developers of wearable technologies such as“smart jackets,” which if installed in CODELCO mines would dictate rhythms and tasks of work, depending on variables including air quality, temperature, altitude, and workers’ physical data such as blood pressure, breath rate, and heartbeat. While engineers highlight the safety aspect of this technology, they are also aware that turbulent labor conditions and relations in the mining sector haunt such modelling. Strikes along copper supply line,especially in mines and ports, have been a salient aspect of Chilean society over the past decade (Rojas, 2016). More recently, mining strikes, particularly around the status of new workers and changes in shifts and benefits, have hurt business confidence in Chilean copper production. These strikes have also boosted investment in automation throughout the industry. The president of the Americas at BHP Billiton Danny Malchuck, after a 43-day strike at the company’s Escondida mine, known to be the world’s largest copper producer, commented that it was “the right time” to introduce “disruptive ‘out of the box’ technology to improve productivity and improve labour relations” (Sanderson, 2017a). Malchuck’s mention of “Google car” type vehicles reflects concepts expressed by CMM engineers working with CODELCO.

For both state and privately owned mines, the fall in copper prices since 2011 has led to rising pressure on companies to increase efficiency. This drive has given rise to an increase in labor disputes. With a new labor law adopted in 2017, more favorable to unions than the previous legal framework inherited from the Pinochet regime, companies are looking to logistics to find a way out from tense labor relations. In the meantime, the nature of copper mining has changed: no longer part of a national autonomy strategy, it has become fully enmeshed in global supply chains where extraction goes together with logistical governance and financial performances. Logistics becomes the connecting element between the restructuring of production and the long-lasting dream of Chile as the “gateway state” for the Americas on the Pacific. Valparaıso port, one of the sites of our research, has a role to play in these dynamics and visions, even as its role in copper export is restricted to the shipping of refined product. Indeed, in tracing the line of copper from the Andina mine through to the point of export, we observed an increasingly automated process of valorization and refinement, which begins with the concentration process inside a mountain cavern on the mine site and ends with the production of cathodes in the smelter at Ventanas, some 40 km to Valparaıso’s north.

Built in 1964 with the idea of igniting the processing industry, the Ventanas smelter paved the way for the surrounding Punchuncavı area to become one of the most industrialized in Chile. Run by CODELCO, the plant refines concentrate transported by train from Andina into cathodes using an electrolytic process of which gold and sulfuric acid are by-products. During our visit to the facility, it became clear the quality of the cathodes is a source of pride for the plant’s management, which boasts that these thin sheets of copper are 99.99% pure but pays little attention to the complex market dynamics and supply chains the product enters when it leaves Chilean shores. Refining the copper to a near elemental state is part of a process of abstraction and valorization that not only separates the metal from ore physically removed from the earth but also creates an anonymous and fungible commodity whose price can be traded on futures markets. Yet, while the purity of cathodes is celebrated, it comes at a cost. The area surrounding Ventanas has been declared una zona desacrificio due to contamination from heavy industry built up in the region. The smelter’s emissions of sulfur dioxide and arsenic have controversially contributed to the environmental devastation of the area and the poisoning of its communities. If copper is the symbol of Chilean modernity, the “toxic lives” of populations who live in the vicinity of Ventanas – including the so-called hombres verdes or green men, ex-employees of CODELCO with “greenish lacerations produced by chemical reactions on their bodies” (Tironi and Rodrıguez-Giralt, 2017: 95) – are its shadowy and damaged underside. They are also another face of the geomorphological impact and glacier degradation that scientific studies and environmentalists attribute to Andina’s operations (Brenning, 2008).

La nombrada electrónica

When the Logistical Worlds project was planned in 2011, the narrative surrounding China-driven logistical expansion in the port of Valparaıso was compelling. Chile had become the first non-Asian nation to sign a free-trade agreement with China in 2005, and by the end of the decade, China had emerged as the country’s first trading partner. In 2010, Valparaıso port had increased its turnover by 27.3%, partly because of the facility’s role in supplying the Chinese market with copper. The port authority had issued a tender to more than double the port’s capacity. In 2008, a new road and tunnel system opened between the port and an inland intermodal logistics park known as the Zona de Extensıon de Apoyo Logıstico de Puerto Valparaıso (ZEAL), inaugurated in the same year. These developments accompanied the introduction of a new port community software system called SILOGPORT, which promised to significantly augment the port’s efficiency and turnover. At the same time, proposals for new trans-Andean transport routes – such as the Aconcagua BioceanicCorridor, a privately funded project involving the construction of a low altitude tunnel under the Andes – promised to link Valparaıso to markets in Argentina and Brazil. Added to this, the signing of sister port agreements to share technology and training with Shanghai and Guangzhou suggested that Valparaıso was poised to become a major gateway for China-driven trade on Latin America’s west coast. An important 19th-century port whose traffic had declined with the opening of the Panama Canal in 1914, Valparaıso’s fortunes seemed to be shifting again.

The years that followed made it clear that this would not be the case. Since 2011, three separate port expansion initiatives have been proposed for Valparaıso. Of these, only one has been realized: the lengthening of a pier by 120 m at Terminal Pacific Sur (TPS) – the facility that handles 90% of Valparaıso’s container traffic. Plans to build two post-Panamax terminals capable of handling craft too big to fit through even the expanded Panama Canal have not materialized. The reasons for these delays include projected competition from the building of post-Panamax terminals at San Antonio 90 km to the south, economic and technical obstacles to the construction of a low altitude route across the Andes, increased shipping access to East Coast Latin American ports with the widening of the Panama Canal,and citizen struggles sparked by Valparaıso’s status as a UNESCO World Heritage Site. Although China remains the number one import partner and number two export partner of Valparaıso port, it seems unlikely that operations will massively increase to accommodate China trade.

Nonetheless, Valparaıso remains an important node in the copper export business, with the metal being its fourth most exported item after fruit, wine, and other comestibles. At the national scale, copper is Chile’s first export at just over 50% in 2016, with the bulk of the metal mined in the country’s north and shipped through ports such as Antofagasta. Most copper exported through Valparaıso is refined and shaped into ingots or cathodes, depending on the degree of purity the metal has obtained. In recent times, China has preferred to import bulk copper concentrate instead of refined product. Chile has matched this preference by developing new technologies for containerizing concentrate in sealed boxes that are then exported from northern ports. However, the refined copper trade remains a significant part of Valparaıso’s turnover, and this places the port within the copper line, which is a primary source of its connection to China.

Part of our study involved research into the role of logistical software in shaping labor relations on Valparaıso’s docks. On a visit to Terminal Cerros de Valparaıso (TCVAL) – a small terminal mostly dedicated to non-containerized cargo including copper ingots and cathodes – we noticed a computer-printed list of workers on shift pasted near the entry gates. Our guides told us that the names corresponded to biometric data held by the company and that the workers had to scan on for each shift with their fingerprints. Research revealed this system to be the so-called nombrada electrónica, which had replaced the traditional labor provisioning system controlled by trade union officials who assigned shifts to workers in hiring halls. Historically, the system involved the possibility for a named worker to pass the right to work to another and to divide wages with them. Although the Pinochet regime eliminated this aspect of la nombrada, the system continued as it proved amenable to private port operators who valued flexibility in labor recruitment.

Until around 2011, la nombrada allowed recruitment of most of Chile’s port labor on a day contract basis. But when grassroots union movements began to use the hiring halls to organize strikes, port operators turned against the system. The introduction of the nombrada electrónica in Valparaıso’s shipping terminals offered a way of maintaining flexibility while wresting control away from unions. In this case, we observed how the introduction of a software system met labor insurgency among precarious workers and shifted the institutional form of labor recruitment. Yet the revitalization of Chile’s labor movement has not been restricted to the port sector and extends to other industries, including copper mining.

Beginning in 2007–2009, contract workers had also organized a series of successful strikes against CODELCO (Rojas, 2016). Culminating in 2013 and combining with a resurgent student movement and ongoing Indigenous land rights struggles, the miners’ rebellion resonated strongly with action on the docks, particularly given the central role played by precarious workers. These affinities were prominent in our analysis the nexus between logistical activities on the docks and the role of software and data analytics in reorganizing the copper line. In these connected instances, the centrality of copper extraction to Chile’s economy has ambivalent implications for the political positioning of labor. It can give workers the opportunity to disrupt a critical industry through strikes and other forms of labor disobedience while also providing a source to discipline workers’ struggles and keep them within the boundaries of an industrial dispute. At the same time, the economic centrality of copper production motivates introduction of “smart” and other logistical technologies that aim to smooth out labor relations by skirting around or minimizing the potential for such disruption (Mitchell, 2011).

Extraction beyond the mine

These dynamics of disruption and the logistical strategies of “fault tolerance” that seek to abate them have been a crucial element of investigation in the Logistical Worlds project. In highlighting the gaps and incompatibilities that disrupt and provide conditions of possibility for projects of logistical coordination, our research has emphasized not only the labor subjectivities that emerge in these fissures but also how different operations of capital mesh or fail to mesh to produce such discontinuities. In this regard, it is important to specify how finance and extraction influence the role of logistics in reshaping both global balances and local conditions. Far from positing the emergence of logistics as a dominant mode of organizing capitalism or a kind of quasi-subject that acts autonomously, our research addresses entanglements of logistics, finance, and extraction by investigating their material workings in ways that resist their integration into totalizing visions of capital (Mezzadra and Neilson, 2015).

The literal extraction of copper ore from the earth’s crust couples to logistical operations thataim at synchronizing diverse modes of production, pushing back costs to various actors whoare under pressure to keep prices at a minimum. This applies even within a large nationalized corporation like CODELCO, which demands of its different divisions that they meet cost reduction milestones (CODELCO, 2016). That CODELCO’s chairperson speaks of balancing cost reduction against labor unrest (Sanderson, 2017b) registers the effects of these measures on labor relations and struggles. Yet the modes of extraction involved in the logistical coordination of the copper line do not equate immediately with the extraction of surplus value that Marx(1977) identified as the crucial moment of labor exploitation in the industrial factory. In the first instance, data-driven adjustments allow capital to extract a quota of value from a range of different productive environments by shaping and commanding them from a distance. In the second instance, capital directly organizes the social cooperation of labor, stretching the temporal and spatial confines of the working day. This is not to say that the exploitation of productive cooperation does not take place in the Andina mine, the Ventanas smelter, or any of the other facilities run by CODELCO. It is to claim, however, that the vertical integration of logistical operations influence and alter the conditions and exploitation of labor in these environments, demanding, for instance, cost cutting measures or the realization of efficiencies in tune with productive processes carried out at other points along the copper line. This is true even if the logistical coordination of copper mining faces the problem of process variability,which makes it difficult to measure, monitor, and reduce turnover times. As SONDA (2018) – the company that designed the software system for the Andina mine – notes, lack of “online visibility” makes it difficult “to identify how this variability behaves for all the stakeholders involved (planning, operation, maintenance and management).” Nonetheless, the production of “relevant information for some of the plant and mine processes” has “enabled process variability to be controlled, which in turn has resulted in greater ore flow quantity and quality.”

When it comes to financial operations, we see a similar dynamic. Copper futures trading occurs in three global markets: the London Metal Exchange (LME), the Shanghai Futures Exchange (SHFE), and the Chicago Mercantile Exchange (CME). Although these institutions administer trades in copper futures and options, the markets themselves rely increasingly on automated and virtualized technologies, making it difficult to locate them in terms of latitude and longitude. As in trading of other derivatives, speculative bets on copper prices serve to relocate risk without transaction of the underlying commodity. Dick Bryan and Mike Rafferty (2006: 12) explain that in “derivative markets prices do not in fact ‘derive’ from the original asset” but “usually run the other way, so that options and futures markets are the places where prices are first formed.” Recent studies of financial speculation in copper prices confirm this observation. Working with LME data from 1993 to2016, Kegomoditswe Koitsiwe and Tsuyoshi Adachi (2018: 88) seek to quantify “the speculative component in explaining copper price increase.” They “find evidence that financial speculation accelerated copper price moves” (p. 92) and they conclude “that fundamental forces alone cannot explain the price moves” (p. 93). This is not to deny the relevance of supply and demand, currency exchange fluctuations, and other factors in setting copper prices. However, it does register the extent to which copper pricing mechanisms have become detached from commodity chain transactions.

To make this claim is not to forget that futures trading requires speculation on future production. As Cedric Durand (2017: 151) writes, finance involves “an accumulation of drawing rights on wealth that is yet to be produced, which takes the form of private and public indebtedness, stock-market capitalization and various financial products.” From this angle, we can discern the extractive dimension of copper price speculation. Such hedging draws on an abstract measure and norm of future production, which is not yet materially defined and which, given the literal extraction and processing that needs to be accomplished, requires capital operations different from those that apply to finance itself. The entanglement of logistical and financial operations shows how they compel productive activity even when they do not directly administer the modes of social cooperation and labor necessary to accomplish this production. As observed in the shipping industry (Bologna, 2010), we note that finance also impacts on the mining industry by fostering dynamics of investment and optimization – such as smart mining experiments – which respond to logics of improvement that can be sold to the market and not just operational priorities. These dynamics nonetheless transform working conditions.

Placed in this context, our study of the Chilean copper line becomes part of a wider investigation of the nexus between logistics and extractive operations of capital (Mezzadra and Neilson, 2017). We can understand these operations in the narrow sense of resource extraction or in a wider ambit that includes financial speculation, data mining, and other activities that draw upon and contribute to the shaping of patterns of human interaction and social cooperation. Investigating this nexus along the line of copper also provides a way to highlight resonances between workplaces and realms – such as ports, mines, and smelters – that many consider separate entities, but which are conceptually and materially connected by logistical operations. In the case of the copper line, as the next section of this article shows, these connections extend beyond Chile to encompass stockpiling practices in China that have important implications for production and pricing. Our analysis suggests that these connections overcome the more direct links implied by the models of supply or commodity chains to entail a series of processes, logics, and forms of power that constitute the wider political dimensions of logistics.

Elements of logistics

Recent scholarship has introduced the concept of elemental media to register the environmental, infrastructural, and existential importance of media. John Durham Peters (2015: 14) writes “Once communication is understood not only as sending messages – certainly an essential function – but also as providing conditions for existence, media cease to be only studios and stations, messages and channels, and become infrastructures and forms of life.”It is certainly possible to understand copper as such an elemental medium, and not only because of its position on the periodic table. The presence of the metal in computer chips, circuit boards, and other electronic networks makes it a pervasive and undergirding element of contemporary capitalism, not to mention its prevalence as a construction material. Yet to ensure that copper conducts electricity without impediment, it must be refined to a high degree of purity. Approaching copper as an elemental medium means not only turning attention to the toxicities and labor struggles that result from its processing but also under-standing the pride invested in its proclaimed purity as a form of fetishism that obscures the social relations involved in its production. An analytical approach through logistics highlights both the more-than-human consequences of the environmental degradation that proceeds from the line of copper and the all-too-human predicament of the labor that facilitates this same set of relations.

The labor that subtracts toxicity from copper concentrate mined in Chile creates a near pure export product whose national provenance cannot be read off its atomic structure. The resulting cathodes are eminently tradable commodities, which, in turn, provide the basis for futures trades on base metal financial markets that fluctuate with demand shocks and inventory levels (Geman and Scheiber, 2017). One of the elemental properties of copper is that it does not degrade over time, making it a suitable commodity for stockpiling. In recent years, with the growing importance of the SHFE for global copper pricing (Li and Zhang,2013), the storage of the metal in Chinese warehouses has had a significant effect on pricing and volatility (Geman and Scheiber, 2017: 131). These financial dynamics are complicated by the fact that stockpiles held as collateral against futures trades and reported by SHFE are accompanied by “dark inventory” stored in bonded warehouses in China’s free trade zones (where duty and taxes are not paid until the product enters the domestic market). Financial traders have used bonded copper stocks as collateral for so-called commodity collateral financial deals, which extend loans at a preferred rate, usually to investors in China’s high yield real estate market. Despite the high degree of digitalization in financial markets, this so-called trade financing relies on paper documents, often stamped with holograms and secret codes. Aside from cases of forgery – such as the high profile “Qingdao scandal” of 2014, where the same collateral copper was committed multiple times (p. 131) – uncertainty regarding the physical stock of copper in China’s bonded warehouses is a parameter influencing the price pressures that have led the Chilean industry toward technical fixes and logistical optimization.

Extending our research along the copper line to encompass the elemental properties of the metal thus allows a wider spatial remit, although we have not had the opportunity to conduct direct empirical investigation in China’s bonded warehouses. What becomes clear from such extended research is that logistics builds connections but has no unifying logic, despite its prevailing discourse of interoperability. The research in Chile drew our attention to the continuities and disruptions between the literal extraction of copper and the wider extractive operations of capital manifest in logistics and finance. Such attention to the diversity of capital’s operations guards against the reduction of capitalism to logistics. Capitalism is certainly characterized by unitary logics that play out across what Saskia Sassen (2014: 211) calls the “systemic edge,” where “general conditions take extreme forms.” But capital’s operations display a high degree of heterogeneity, which deserves careful analysis from political, legal, spatial, and social viewpoints. This means that when scholars like Martin Danyluk (2017: 631) attribute a “unifying logic” to relations of exploitation and dispossession along logistical chains, we should refer this logic to the conceptual horizon of capital itself, which, as even a cursory reading of Marx reminds us, is always refracted through the materiality of social relations and the making of the world market.

Logistical operations produce political spaces, projecting an image of endless control over time and space. The imposition of protocols and standards cutting across social, spatial, and territorial differences suggests the strategic dimension of logistical power that is reflected in the productive tension between the concepts of the “visual supply chain” and the“visible supply chain.” In logistics industry lingo, the visual supply chain refers to modelling efforts that aim to represent the entire chain in order to define and sustain the decisions of companies’ operation management units, while the visible supply chain uses technologies such as radio frequency identity (RFID) tags to monitor movement and operations on the ground and command real time adjustments. The negotiation between the visual and the visible constantly tries to translate social and political frictions into measurable technical variables. This in turn inspires new cartographic exercises linked with the making of logistical corridors and fosters conflicts, obstacles, and violence on the ground. While corporations and governments trace their imaginary of connectivity on masterplans, these projections result in resource expropriation, zoning exercises, regimes of labor, and forms of struggle that reconfigure territories.

The visual and the visible signal the logistical dream of socially blind seamless operations and computational governance. Nevertheless, the empirical research conducted for Logistical Worlds revealed how logistical dreams produce spaces of informal economy and labor that are at once excluded from the just-in-time chain of command and integrated into logistical governance in ways that often elude inspection. This observation goes against the idea that we can trace a sharp opposition between formal logistical chains and what lies outside them, or even against them. Logistical initiatives build imaginaries of continuous control via the use of sophisticated technologies and a narrative that produces symbolism and aesthetic landscapes. Yet we should not forget that this self-fulfilling fantasy leaves aside that which is invisible to computational regimes. Far from being “exceptions,” these elements are constitutive of logistics at least in two ways: firstly, because these are the only conditions of possibility for logistics to exist and operate; secondly, because logistical operations reach beyond themselves, which is to say beyond their internal regimes of governance. The concept of “project influence areas,” often applied in discussions of the “politics of corridors” and used to describe the “collateral damage” produced by infrastructural initiatives, is relevant here (Dey and Grappi, 2015). With regard to the Chilean copper line, such influence areas are evident not only in the toxicity surrounding the Ventanas smelter but also in vast geo-engineering projects associated with the Andina mine (see Figure 4), from which earth has been removed and used to literally fill whole mountain valleys. Returning to Valparaıso, we can observe how logistics spills over to the city as such, both in marketing discourses that present it as a “port city” and in social struggles that oppose waterfront regeneration from the perspective of heritage values and a deep-seated sense of identity (Bergamin, 2015).

Figure 4. Operations at Andina mine, 3500–4200 m.

The continuous transition from forms of formal, computational governance to informal, off-the-grid practices haunts logistical fantasies of control. Tracing these operations reveals the paradoxical dimensions of logistics in relation to labor, politics, and space (Grappi, 2016: 61–80). Through its capacity to “produce space,” logistics generates particular formations and territorial settings that partially overlap with the geopolitics of states, but also constantly overcome them with a distinct demand for cooperation within networks and circuits that spill across state agencies and borders. Such political productivity, however, should not license a vision of logistics that sees it as potentially replacing forms of politics and power associated with the state. Whether we discuss corridors, zones, enclaves, chains, or any of the other spatial forms generated by logistical activities, state structures remain active in the background and sometimes at the forefront, both as an enabling force and an animating spirit. Rather than observing a contraposition, we note the paradoxical relation between logistics and the state: indeed, logistics both weakens and reinforces the state, particularly under variegated neoliberal conditions in which states, to different degrees, vacate the project of nation building or providing benefit, protection, or welfare for “the people.” Paired with the global reach of capital, this is what allows logistics to step in, offering a promise of development or growth that connects to the global but is always unequal and cannot be pinned back or held accountable to a body politic.

In the case of the Chilean copper line, the introduction of data-driven routines of logistical governance promises to optimize operations in ways that can sustain production during periods of price downturn and guide the industry beyond rentier extraction. Yet this implicates the production process in logistical and financial regimes of extraction that reach beyond the state’s capacity to regulate, say, the national labor market, and yet, at the same time, produce returns that can be deployed for state sanctioned social or community development projects (Martinez and Franks, 2014). In seeking a “social license to operate,” such projects aim to establish legitimacy for copper extraction despite its negative impacts. Comparing social development projects run by CODELCO Andina to those pursued by the adjacent and privately owned Los Bronces operation, Carla Martinez and Daniel M Franks (2014) find that the facility’s “status as a state-owned operation had little impact on perceptions of people regarding the legitimacy of the mine at the local level” (p. 301). Clearly, the intertwining of logistical projects with state logics is insufficient to grant them social legitimacy. To suggest that logistics is politically incomplete or wanting of legitimacy, then, is not to claim it must seek the endorsement of formal power or tacit consent. Rather, this suggestion registers the sense in which the separation of logistics from such power and consent allows it to entwine with state logics at the same time as it exacerbates tensions and ranges freely in pursuit of extractive projects. It also indexes how logistics constantly appeals to the institutional structure of the state, including its normative framework, police and army, to function and operate. Far from being autonomous, the disruptive power of logistics is not self-sustaining and finds a limit in itself, seeking the power to overcome its limits from the same state it pretends to overcome. As Deborah Cowen (2104: 214) argues, logistics perpetuates geographies of “organized violence” in ways that cut across the inside/outside of state space and the supposed stability of “the Hobbesian distinction between anarchy and order.” Our analysis suggests that in this process the state is not discarded but rather transformed by its entanglement with logistical operations.

Conclusion

By considering the relation between the elemental properties of copper and the elements that constitute logistics as a political force, we have analyzed the role of copper in Chilean history and how through logistical operations it has moved from being an asset to become a symbolic value and then a site of social experimentation. Through an investigation of what we call the line of copper, we have also shown how the Chilean mining industry and its existing and future projected infrastructures entangle with the global geo-economy and the geopolitical dimension of China’s expanding technical and strategic interests. This has allowed us to make observations that insert the study of infrastructure and supply chains into a political investigation of the role of logistics in the contemporary operations of capital. In line with previous arguments about the “multiplication of labor” (Mezzadra and Neilson, 2013), logistical operations produce a complex grid of political spaces in various relations with states, borders, citizenship rights, labor regulations, legal regimes, practices of mobility, and so on. The unevenness and unstable synthesis of logistical transformations we have observed points to the question of understanding the link between logistical forms of organization and such a redefinition of labor.

The investigation of the copper line allows us to discern how extractive operations of logistics and finance generate regimes of labor precarity. More importantly, it points to the emergence of labor struggles that reach across diverse sectors and hierarchies to confront a condition where capital is able to route around disruptions. In such circumstances, insurgency against any specific capitalist actor, if it is to be effective, needs to generate an encounter with the wider assemblages of capitalism that enmesh this actor, without forgetting the global dimension of logistical operations. Struggles in the Chilean mining and port sectors have been inventive in this regard, and importantly have entered into unstable alliance with environmental, student, and Indigenous struggles. These patterns of alliance show how political practices forged in the grip of logistical command are beginning to cross lines that current theory draws and reinforces between a politics of limits that emphasizes the excesses of the human and a politics of overcoming limits that finds possibility in labor or the human capacity to produce. This crossing of lines suggests that the by now widely recognized political dimension of logistics goes far beyond the realm of transport and circulation. We have argued that logistics remains politically incomplete and enters into complex entanglements with state power due to its want of legitimacy and need to be sustained by the organized force of the state. This insight adds another dimension to the claim that logistics allows us to see “the immense material resources and ideological labor necessary to claim control and ownership over spaces and bodies” (Chua et al., 2018: 626). Struggles conducted in the face of logistical power introduce new elements of politics with the potential to inspire organizational practices well beyond the limited sector of logistics as usually conceived.

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Giorgio Grappi, is research Fellow at the Department of Political and Social Sciences,University of Bologna. He is the author of Logistica (Ediesse, 2016). He has been involved in the project Logistical Worlds: Infrastructure, Software, Labour (logisticalworlds.org).

Brett Neilson, is professor at the Institute for Culture and Society, Western Sydney University. With Sandro Mezzadra, he is author of Border as Method, or, the Multiplication of Labor (Duke, 2013) and The Politics of Operations: Excavating Contemporary Capitalism (Duke, 2019). With Ned Rossiter, he coordinated the project Logistical Worlds: Infrastructure, Software, Labour (logisticalworlds.org).


Article published by Society and Space 2019, Vol. 37(5) 833–849

https://journals.sagepub.com/doi/pdf/10.1177/0263775818814535

 

Giorgio Grappi and Brett Neilson

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