With the flip of a switch, electrons race through copper wires to light up your home. With the stroke of a pen, a Latin American miner just sent a similar surge of current into a sector that needed the energy.

Southern Copper (NYSE:PCU) has issued a friendly bid to acquire junior miner Frontera Copper for about $34 million. With an enviable cash balance of more than $1.8 billion, the deal is small potatoes for a major miner like Southern Copper. Nonetheless, in an environment where miners have taken every precaution to rein in production and shore up liquidity, the move signals a restoration of confidence and visibility in copper's long-term outlook.

Taking a page from Freeport-McMoRan’s (NYSE:FCX) playbook, Southern Copper took an enormous writedown last week, converting what would otherwise have been a $130 million gain into a $125 million loss for the fourth quarter. Absorbing price declines of 46% for copper and 54% for molybdenum over the prior-year period, Southern Copper responded by cutting operating cash costs by more than 26%. After by-product credits, the company now can produce copper for just $0.34 per pound, maintaining a substantial margin even at present low prices.

One development that surely generated little excitement among shareholders was the 66% reduction to the company's quarterly dividend. To ease the pain of a still-respectable 3.1% yield, however, the company repurchased nearly 30 million shares for an average price of $13.52 each; effectively increasing each shareholder's stake by 3.5%.

Anyone still feeling shortchanged might consider that Southern Copper perceives tremendous opportunity in the presently depressed copper market, and indicates an appetite for more deals like the Frontera purchase. Frontera's Piedras Verdes Mine, after all, will produce about 32,000 tonnes of copper annually for at least 11 years.

Given the historical uniqueness in scale of the recent reversal from commodities boom to global bust, it is important not to overstate the significance of this one deal. Southern Copper sees demand beginning to stabilize near mid-2009, but only after further mine closures bring oversupply into balance. BHP Billiton (NYSE:BHP) sounded less encouraging when revealing Wednesday that profits were cut by more than half. Rival Rio Tinto (NYSE:RTP) remains in distress, and recently courted Aluminum Corp. of China (NYSE:ACH) for a capital infusion.

For exposure to copper plus a whole lot of gold, I still believe Yamana Gold (NYSE:AUY) shines brightest.

Further Foolishness:

The insightful investors over at Motley Fool CAPS have refused to give up on Southern Copper. More than 4,000 CAPS members, including 881 All-Stars, expect this five-star pick to outperform the S&P 500. I updated my pitch in November to reflect changing circumstances. If you think Southern Copper is ready to shine, rate it as an outperform. If not, call underperform. Either way, come over to CAPS and tell us why.

Fool contributor Christopher Barker is the commodore of copper, and the Colonel Klink of zinc. He can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He owns shares of Aluminum Corp. of China, BHP Billiton, Freeport-McMoRan, and Yamana Gold. The Motley Fool's disclosure policy is worth way more than $1.50 per pound.