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

Codelco delivered a 34,000mt surplus in refined copper production during the first half of 2020, despite the effects of the COVID-19 pandemic. 


The state-backed Chilean miner produced 744,000mt of the red metal in H1, up 4.7pc from the same period last year. The company’s construction projects continue to remain on hold due to curbs to safeguard from the COVID-19 pandemic. However, Codelco stated that its Chuquicamata Subterranea mine (underground pit) and expansion of the El Teniente mine stood at 99pc and 61pc completion, respectively. 


The company delivered an EBITDA of $1.8bn and profits of $380mn, which rose 18 and 20pc, respectively, from the prior-year period. 


Will the elevated volumes last?

An ongoing water crisis is threatening the supply of mine products in Chile with the Escondida mine already feeling the heat of the country’s environmental authorities. 


Chile’s National Environment ministry, Superintendencia del Medio Ambiente (SMA) has charged the BHP group, which operates Escondida, for overdrawing water for a period of 15 years. The charges could lead to fines as well as cancellation of work permits for the miner. Codelco has also suspended expansion of its Salvador mine due to the issue, while Anglo American faces similar water supply challenges at its mines in the region. 

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