Chile losing ground as top copper producer as metal price in the pits – by Cecilia Jamasmie ( – January 22, 2016)

Resilience in the copper industry, its producers and investors, continues to be tested this year, as the metal price has touched fresh lows, falling last week to $1.95 per pound, a price last seen in May 2009, and analysts don’t see a clear end to China’s slowdown.

Last week, Chile’s state copper commission Cochilco cut again average copper prices for the year to $2.15 and $2.20 per pound in 2017, about 35 cents less than what it predicted in September.

At those prices, companies will likely reduce copper output, said the group. For this year, Cochilco expects an increase in production of only 0.1% more than 2015, which reached 5.76 million tonnes, but for 2017 it expects production to pick up, growing 3.1% to 5.95 million tons.

The situation is worse than many think, according to the country’s mining industry group Consejo Regional Minero de Coquimbo (Corminco), which represents some of Chile’s top miners in the copper sector, including Antofagasta (LON:ANTO), Glencore (LON:GLEN) and Teck Resources (TSE:TCK.A, TCK.B) (NYSE:TCK).

Its president, Juan Carlos Sáez, warned in November that a “majority” of the group’s members were already unable to make a profit.

“We hope this is already the lowest level,” said Sáez referring to copper prices of about $2 per pound. “Because it’s below the limit of exploitation for the majority of miners in the country.”

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