Copper news, page-1273

More bad news on copper output from Codelco in Chile. see reprt below hot off the press.
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Codelco Struggles to Halt Persistent Slide in Copper Output

The top supplier has seen production plunge to its lowest in decades. The implications reach far beyond Chile.


Codelco’s Chuquicamata open pit copper mine near Calama, Chile. Declining output is crimping supplies of a metal considered key for the energy transition.
Photographer: Cristobal Olivares/Bloomberg

By James Attwood
June 19, 2024 at 9:40 PM GMT+10



Codelco, the world’s biggest copper supplier, insists it’s coming to grips with production issues. But output keeps falling, and analysts aren’t convinced the Chilean state behemoth will meet its own pledge to halt the slide.

Operational setbacks at mines and long delays at development projects dragged yield to its lowest in a quarter of a century. The company, which has posted eight straight monthly declines, says it will reverse that trend in the second half of this year.

Codelco’s predicament stems in large part from decades of underinvestment as successive governments diverted cash elsewhere. Efforts in recent years to make up lost ground led to the company juggling four major projects inside a $40 billion budget.

That spending splurge has yet to solve Codelco’s biggest problem: aging mines with a declining quality of ore.
To be sure, Chief Executive Officer Ruben Alvarado is shaking up management, including decentralizing the chronically underperforming projects team. Codelco is on track to produce more this year than in 2023 as part of its long-term recovery, the company said in a written response to questions.
Copper's Changing of the Guard?

BHP is predicted to replace Codelco as the world's No. 1 producer
Source: Bloomberg Intelligence
Still, analysts and traders have learned to be skeptical about Codelco’s guidance after years of disappointment. Bloomberg Intelligence’s Grant Sporre recently lowered his projection and now sees it below 2023 levels, with BHP Group Ltd. overtaking Codelco to become the top dog in copper.
“They’ve had a very slow start to the year, and I don’t think they can catch up all of it,” Sporre said.

Codelco’s struggles also have an impact far beyond Chile. The difference between the amount of copper the firm churned out six years ago and what it produces now amounts to enough metal for about 5 million Teslas a year.

Globally, there are serious concerns about where the extra copper will come from in the years ahead to satisfy what’s expected to be a major increase in demand, not just for electric vehicles but also for new transmission lines and data centers.

Copper already traded at a record high this year, and a failure by Codelco to resolve its operational problems may help sustain those tailwinds.
--James Attwood, Bloomberg News