SHANGHAI, Nov 11 (SMM) – Chinese copper smelters are likely to see limited upside in treatment charges for copper concentrate next year, in anticipation of tighter ore supply with expanding smelting and refining capacity domestically and moderate mine production growth globally.
Limited large copper mining projects are expected to come online in 2020, while the forthcoming expiration of a bunch of labour contracts grows the risks of strikes. That, together with existing headwinds, will drag on copper mine production growth in the coming year.
For copper mine production in the first nine months of 2019, major miners broadly reported declines, with BHP saying its output dropped 2.4% year on year to 1.29 million mt.
Production from the UK-Australian miner’s Escondida mine in Chile, the largest copper mine in the world, tumbled 7.9% to 848,300 mt in 9M 2019, offsetting gains from the company’s other mines.
During the same period, copper production from Chile's Codelco declined 6.8% to 1.12 million mt, due to heavy rainfalls earlier in the year and labour strikes, while Freeport-McMoRan reported a year-over-year decrease of 18.6% to 1.1 million mt.
The American mining giant Freeport McMoRan, controls the world’s second-largest copper mine in Indonesia, Grasberg, which is transferring from open-pit mining to underground, leading to a year on-year decline of 239,900 mt in production in 9M 2019.
Reports from Glencore showed that copper production from the Swiss-based miner shrank 4.4% on a yearly basis to 1.02 million mt in 9M 2019, pulled down by production reduction at its Mopani and Mutanda mines.
Notably, the Mutanda copper and cobalt mine in the DRC will shut for at least two years from the end of this year, a significant loss of copper ore supply for next year.
Southern Copper Corporation (SCC), however, saw a year-over-year increase of 13.7% in its copper mine production in 9M 2019, as a gain of 67,000 mt in its Toquepala mine in Peru after the opening of a new beneficiation plant expanded the company’s overall production to 737,400 mt.
The Mexican mining company’s copper production growth was also helped by a 23,000 mt increase at its Buenavista mine in Mexico, after the hydrometallurgical stage was upgraded.
