Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Antofagasta’s copper production this year is expected to be in the lower end of the company’s guidance range of 725-755,000mt—provided COVID-19 doesn’t cause more shutdowns.


The company has operated using less manpower because of the pandemic, and rescheduled maintenance activities could its affect copper production guidance, costs, and capital expenditure plans this year. 


With the Los Pelambres Expansion project on hold, the company expects capital expenditure to be close to $1.3bn instead of its original guidance of $1.5bn.


In Q1 2020, the company’s total copper production increased by 2.9pc to 194,000mt compared to 188,600mt in Q1 2019, and it rose by 4.6pc over 185,500mt in Q4 2019. Antofagasta’s sales in Q1 2020 increased by 9.2pc to 195,300mt from 178,900mt in Q1 2019, and by 0.8pc from 193,800mt from Q4 2019.


The company’s cash costs during Q1 2020 dropped by 11.2pc because Chile’s currency is weaker, production was higher, and cost controls were tighter.


The company has taken measures to prevent the spread of COVID-19, including keeping a workforce of two-thirds its normal size. However, even with a limited workforce, Antofagasta’s operations have not been heavily impacted. According to Ivan Arriagada, Antofagasta’s chief executive officer, the company is in a strong position to confront the uncertainty ahead, as well as lower copper prices, because it has a robust balance sheet of $2.5bn cash. 


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