London-headquartered Antofagasta has kept its full-year copper guidance unchanged at 730,000-760,000mt. The company released Q2 production report stating that production and costs were in line with the guidance.
Production and sales
Copper production in Q2 was at 178,400mt, down by 2.5pc from the prior quarter. In H1, 361,500mt copper was produced, down by 2.8pc from a year-ago period.
Sales in Q2 dipped by 10.6pc to 163,400mt and in H1 was 7.5pc lower after having sold 346,100mt. At the end of June, shipments of 15,000mt were delayed at ports, mostly at Centinela, owing to harsh weather conditions. These shipments will be accounted for in the September quarter as they were dispatched in early July.
Molybdenum production in Q2 was 2,800mt, 200mt lower than the prior quarter. In H1, production rose to 5,800mt, 5.5pc higher than the same period in 2020.
Antofagasta has maintained copper guidance for the year owing to strong performance at Los Pelambres and Centinela in H1. The company stated that precipitation at Los Pelambres until June this year has been significantly less than 2019, which was itself the driest year of the current 12-year drought. By the end of H1, the expansion project at Los Pelambres was 52pc complete and is expected to be completed in H2.
Capital expenditure for the year is expected to be in line with original guidance at $1.6bn.
The company announced new emission targets to reduce direct and indirect GHG emissions by 30pc by 2025 to achieve carbon neutrality by 2050. A 30pc drop in emissions would result in a reduction of 730,000mt of CO2.
Antofagasta stated that inflationary pressure on costs has been moderate and arising from higher commodity prices including diesel, energy and acid. Copper, gold and molybdenum prices have witnessed strong movement in H1 with copper trading at two-thirds times higher than last year. The global economy is expected to recover further as vaccination roll-out continues which would further support copper markets.