Hot Commodity, Cold Comfort
(FORTUNE Magazine) - Pascal Kasereka emerges from a forest carrying his weight in rocks slung over his back. "We are lucky to have these rocks in the earth," says the 16-year-old, who has spent two days walking from a tin mine in Walikale in eastern Democratic Republic of Congo to sell his load. "I hear the Americans like them."
Soldiers with Kalashnikovs herd Kasereka and a dozen others to a corner of a clearing near the town of Mayuwano as middlemen weigh their sacks of ore and pay them 30 cents a kilogram--about $15 for the rocks on Kasereka's back--a price guaranteed by the guns pointed at him. The teenagers fall to the ground in exhaustion, while a few feet away those same sacks are sold for five times the price. They will ultimately fetch $350 on world markets, after they are flown out of Mayuwano on rusty Russian Antonovs and smuggled to Rwanda and other destinations.
Cassiterite, the ore that contains tin, is a hot commodity now that environmental regulations have forced the global electronics industry to use tin instead of lead in circuitboards and other components. The price of tin has nearly doubled since 2002, to about $7,600 a metric ton. But few end users seem aware of the hazardous conditions and low wages miners like Kasereka endure.
"The tunnels in Walikale are not safe," whispers Kasereka, who climbs into mines wearing flimsy rubber boots and a flashlight tied to his head. "There is no space to breathe. They collapse every few days, and miners die. Their graves are in the forests." But, Kasereka says, his family would starve without the money he brings home.
Far from Walikale, Bruce Moloznik, a vice president at Cookson Electronics Assembly Materials, the New Jersey manufacturer of more than a fifth of the world's solder, which is used in circuitboards, expresses surprise to learn where much of the world's tin comes from. "Africa has never been mentioned as a source of our tin," he says, adding that his company "is not interested in supporting anything illegal."
The reason Moloznik and others don't know they are buying tin sourced in Congo, according to Global Witness, a Washington, D.C., research and advocacy group, is that most of it disappears into world metal markets and is labeled as coming from Malaysia, Belgium, or South Africa. According to a report published last year by the group, the mines around Walikale alone produced about 3% of global production, most of which was smuggled into Rwanda. That country, the report said, exported five times the amount of tin it produced yet recorded no legal imports. Most of Rwanda's exports were sent to Malaysia, other African countries, and Britain, according to export documents obtained by Global Witness, but none of those countries reported any significant imports of Rwandan tin ore. All of which means that for the rest of the world, Congolese tin simply does not exist.
Congo contains some of the world's richest deposits of gold, diamond, copper, and other minerals, but its wealth has long been a curse for its war-torn villages, washed over by waves of greedy gunmen who looted the mines and exploited miners during a decade of conflict that killed nearly four million people.
"This is dirty business involving high-ranking officials, politicians, and the interests of member states," says a UN official who investigates illegal resource exploitation in Congo and who asked not to be named. "We won't have action until it is no longer politically correct to ignore the situation."
Congo's Minister for Mines, Ingele Ifoto, deplored the bleeding of his country's wealth but claimed only pressure from abroad could catalyze change in his lawless country. "As long as there is a global demand, the smugglers will find a way to supply it," Ifoto says. "Our borders are too vast to be guarded by us."
Multinational corporations like Cookson say they oppose illegally sourced minerals, and some, including Samsung (Research), say they impose strict conditions on suppliers and contractors. But for now, miners like Pascal Kasereka continue to sweat and risk their lives in their mineral-cursed forest to keep the electronics industry humming.