In the previous part of this series, we saw how Freeport-McMoRan’s (FCX) revenues are spread across various products. Now we’ll look at the geographical breakup of Freeport’s revenues.
North America and Asia
The above chart shows Freeport-McMoRan’s major markets geographically. As you can see, it gets 45% of its revenues from North America. Its operations there focus mainly on US markets. It gets revenues in the United States mainly from copper and energy sales.
Asia is the second biggest contributor to Freeport’s revenues, accounting for almost a quarter of Freeport’s revenues. Japan, Indonesia, and China are among Freeport’s major markets. It’s noteworthy that copper mining is concentrated in Latin America while more than half of copper is consumed in Asia.
China is the largest consumer of copper in the world. However, its share in global copper reserves is a paltry 4%. China is also the largest copper importer, followed by Japan. Freeport gets ~5% of its revenues from China. This makes it vulnerable to the slowdown in the Chinese economy. The iShares China Large-Cap ETF (FXI) gives you exposure to Chinese equity markets.
Freeport gets more than 11% of its revenue from Europe. Spain and Switzerland are among its major markets in Europe. The Vanguard FTSE Europe ETF (VGK) gives you access to European equity markets.
Along with Freeport’s revenues, investors should also be watchful of Freeport’s profits and how they’re spread across its various operations. Let’s take a look at this in detail in the next part of this series.