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Antofagasta's copper stocks will take 3 months to return to normal after blockage

8th May 2018

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LONDON – Chilean copper producer Antofagasta said on Tuesday it will take up to three months for stocks to return to normal after the discovery of a blockage in the pipeline that carries concentrates from the Los Pelambres processing plant to port.

Production guidance for the full-year was unchanged at 705 000 t to 740 000 t, it said.

Any disruption, however, could add to market concern over tightening supplies of a metal expected to be in high demand for electrification.

The blockage was found during scheduled maintenance completed on April 16. The pipeline was immediately suspended, Antofagasta said in a statement.

No damage to the pipeline was detected, no leak occurred and the filtering of concentrates resumed at the port of Los Vilos on May 5, it said.

Other operations and shipments have continued as normal as the port has worked through stocks, but it will take up to three months for the stockpiles at the plant and the port to return to normal levels, Antofagasta said.

The impact of the blockage is measured as the quantity of copper concentrate filtered at the port – approximately 10 000 t – for the six months to June 30.

Sales in the same period are expected to be impacted by 15 000 t, but for the full year the impact will be less than 5 000 t, meaning the previous forecast range is unchanged.

Copper prices have firmed over the last month as concerns mount about possible disruption and the lack of new sources of a metal expected to be in high demand from electric vehicles and wider electrification.

Antofagasta announced in April its first-quarter production had fallen by 10.5% versus the previous year, mainly because of lower quality ore, but kept full-year output guidance unchanged.

Edited by Reuters

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