America's second largest open-pit copper mine sits eerily silent here, the only sound a buzz from bees and locusts in the shrubs along its three-mile circumference. Art Dixon, one of 2,100 workers laid off when the mine closed, is at his home atop a nearby hill, packing a bag to look for a warehouse job in Oklahoma.
Just a four-hour drive to the south, noise fills another huge copper mine, where more than 2,500 people are working and a new smelter is going in. But that is Nacozari, Mexico, the nearest example of the rising Third World copper industry which is rapidly taking over world production.
After its two most productive years in history, the U.S. copper industry has sunk into a deep, and perhaps permanently damaging, slump. About 9,000 copper workers have been laid off, production is down about a third and foreign competitors like the La Caridad mine in Nacozari have become so active that the United States has become a net importer of the metal.
Copper workers are used to ups and downs, but the unusual vigor of foreign competitors, which have the full support of their governments and fewer wage and pollution control costs, has led many U.S. copper company officials to wonder if they can ever climb back again to their old prosperity.
Although the U.S. industry is still the largest in the world, Stephen L. Hudgens, a personnel assistant with Phelps Dodge, said, "You know, it's kind of sad," as he surveyed the red- brown vastness of the Morenci open pit. "But it's not beyond the figment of imagination that it could be all over."
He considered the mine, the hundreds of homes, the modern tiled-roofed shopping center, the hospital, the motel and even the local Dairy Queen--all owned by Phelps Dodge. If the copper mine did not reopen, "this would be a ghost town, no question," Hudgens said.
A metal whose refinement helped launch Western civilization and named an era of history, copper is vital to the housing and automobile industries whose own slumps have pulled copper down with them. The metal is used for wiring and plumbing in houses and in wiring and radiators in automobiles.
Copper is also essential to the manufacture of many weapons in wartime, but high labor costs and pollution control expenses have so cut into the American share of the market that the country now imports 289,000 more tons of copper a year than it exports.
"We have a major resource industry in the United States that is going down the tube and there is virtually no recognition or sense of responsibility at the federal level," said Rep. James D. Santini (D-Nev.), the mines and mining subcommittee chairman who wants some trade protection and relief from pollution control costs for the copper industry.
Phelps Dodge employes, from board Chairman George B. Munroe down, insist the company will rebound and the mine here will reopen once copper prices go back up, but they cannot predict how much of the U.S. mining industry's share of the world market will be recovered.
U.S. mines produced 1.5 million metric tons of copper in 1981. W. C. Butterman, copper commodity specialist for the U.S. Bureau of Mines, said he estimated this would drop to 1 million tons this year if recently closed mines are not reopened before December.
Phelps Dodge has closed all of its mines and all but one of its smelters where raw ore is turned into usable copper. The price of a pound of copper has dropped to about 70 cents while the cost of producing that same pound at Morenci has risen to about $1.
Regular strikes have forced this mine to close before, but not since the Depression has the company closed down the plant because of a business slump.
In late 1980, when the Anaconda Co. closed its copper smelter and refinery in Montana, it began to ship its concentrated ore to Japan for refining. This was a significant reversal of the traditional role U.S. refineries played in collecting ore from foreign suppliers.
In speaking to workers here, Munroe said American copper producers operate under several handicaps when facing foreign competition. Most copper producers in the rest of the non-communist bloc are handling relatively rich ore with 1.58 percent copper compared to less than 0.7 percent copper in ore mined by Phelps Dodge. And, most foreign smelters do not operate under costly pollution control rules which will require $150 million in new equipment at Morenci alone.
Foreign mines and smelters, Munroe said, also operate with generous government subsidies and, in some cases, low-cost World Bank loans. The wages paid to their workers are also much lower than those paid in the United States where a middle-level employe like Dixon can earn up to $750 a week.
"I feel personally that stronger tariffs would help," said the 28-year-old repairman Dixon, echoing the feelings of the highest officials in his company. He said he is not eager to pursue a job prospect in Tulsa but "already most of my friends are gone or on the verge of leaving. Every day you can count the cars going out, the U-Hauls."
Jim Daniel was a maintenance electrician before he was laid off along with Dixon and hundreds of others April 17. He is looking for work and people have told him that electricians and welders might be able to find employment more quickly than others, but he has found nothing so far. "You know how the economy is now," he said.
H. E. Dunham Jr., general superintendent for the Phelps Dodge plant here, shares the general exasperation with competition from foreign copper mines--some of them even supported by U.S. bank loans. Dunham, who has worked as a copper consultant in any foreign countries, said even in periods of low prices governments with heavy investments in copper cannot afford economically or politically to lay off their workers. So in places like Chile "they are going all out," Dunham said, "and all that copper's coming into this country."
In the view of Keith Coombs, a Bank of America vice president in its Mexico City office, that description does not fit the La Caridad mine, however, because Mexico uses its copper internally. Bank of America led a group of banks in helping to finance the $1.3 billion project, which is owned in part by the Mexican government, Coombs said.
He said it is able to operate, while U.S. mines have closed, because of the low wage scale and low cost of diesel fuel in Mexico. La Caridad could only be considered a competitor of Morenci "if you look at the copper market as a global market."
Jackie Cooper, a general field foreman, is among 1,179 Phelps Dodge employes here still at work, but as a member of the Greenlee County Board of Supervisors he must still wrestle with the economic consequences of the shutdown. County revenues this year are expected to be cut almost in half and the supervisors have already had to cut way back on the summer recreation program and anticipate more unpleasant surprises. "The mine had not shut down since the Depression, so I never actually expected it to happen here again," Cooper said.
The first few days after the shutdown took on an almost strike-like holiday mood, with some workers believing speculation that the mine would reopen June 1. But that hope has vanished and the uncertainties of copper prices, automobile sales and foreign competition leave everyone wondering what comes next.
Now, Cooper said, "Every day there are tremendous numbers of people who are leaving, and who aren't going to come back."