SMM: global miner Anglo American said on Thursday that it was increasing its metal and diamond output to meet its full-year targets set in the spring, reporting a sharp drop in production in the second quarter due to the new crown pneumonia epidemic.
Anglo American said the production target depended on the progress of the epidemic, which is spreading rapidly in South Africa, while the impact of Chile's drought on its largest copper mine showed no sign of ending.
Overall output fell 18 per cent in the three months to June, with production of diamonds, platinum, palladium, iron ore, coal and manganese all down, while copper and nickel production increased.
Anglo said it was increasing output and capacity had increased from about 60 per cent in April to about 90 per cent by the end of June, maintaining its 2020 outlook for all products except coal.
The company cut capital spending in April and lowered many of its full-year production targets.
Anglo American said the blockade imposed by the governments of Botswana, Namibia and South Africa hit diamond, platinum group metals, iron ore and coal production in the second quarter.
Since then, the situation in South Africa has improved, and the government lifted restrictions to contain the outbreak this quarter, bringing the total number of confirmed cases to more than 300000.
In addition to the shutdown associated with the new crown virus, AngloAmericanPlatinum was also affected by the maintenance and upgrade of a converter plant.
Anglo American's copper production rose 5 per cent to 167000 tonnes in the second quarter from a year earlier, driven by a 38 per cent rise in Chilean Collahuasi mineral output.
But LosBronces output at Anglo American's largest mine in Chile fell 12 per cent and will continue to be affected by a severe drought.
The company said coal output was damaged by a gas explosion at the Grosvenor Metallurgical Coal Mine in Australia. Australia has launched an investigation into the time of the explosion, which injured five workers.
"due to relatively low expectations into the second quarter, this result is likely to be viewed relatively positively," said TylerBroda, an analyst at RBCCapitalMarkets.
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