The world’s top copper miner posted the lowest production in more than a decade during the first quarter after heavy rains hit its operations and output declined across all of its aging mines.
Chile’s Codelco churned out 370 900 t in the first quarter of 2019, down 27% from the previous three months and the lowest since the second quarter of 2008, according to a monthly report by the government’s copper agency Cochilco. March monthly production recovered after it fell to the lowest in more than three years in February.
Output for the month and for the quarter fell sharply at El Teniente, Codelco’s largest mine. The Santiago-based miner is halfway through a $5.5 billion project to build a new level to extend the century-old mine’s life for 50 additional years. The project is part of the company’s plan to invest more than $20 billion over the next decade in order to upgrade mines.
Codelco didn’t immediately respond to a request for comment.
The company is bullish on copper prices and said last week that a slump in copper prices won’t last long, as it expects disruptions to crimp supply amid stable demand. Codelco has said in the past that the multi-billion investment programs will allow it to maintain production levels. But uncertainty over the funding of the projects and past delays in completing work have led analysts and investors to question whether the company can stay ahead of competitors after 40 years as the largest producer of copper.
Output at its own mines and those owned jointly with Freeport-McMoRan Inc. and Anglo American was at 1.8-million tons in 2018. BHP Group was close, with 1.75-million tons in its last financial year. BHP’s Escondida, also in Chile, is the world’s largest copper mine, with production of 274 800 t in the first quarter, more than half of Codelco’s total output, according to Cochilco.