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

Poland’s largest copper miner, KGHM Polska Miedź SA, expects refined copper production to remain flat for the rest of 2020, but projects lower copper outputs from its mines during the year. 


The company forecasted its copper in concentrates production to remain at 399,000mt at the end of 2020, unchanged from its actual copper concentrates output in 2019. Electrolytic copper production could inch down to 563,000mt this year from 566,000mt produced in 2019.


Its copper ore production at the KGHM International mine is expected to fall to 72,000mt during the year from 77,000mt last year. However, output at its Sierra Gorda mine will ramp up to 79,000mt in 2020 from actual production of 60,000mt in 2019. 


In fact, higher copper content in the ore found at Sierra Gorda saw KGHM’s Q1 2020 total copper production rise by 1pc to 174,000mt from 173,000mt during the same quarter last year. However, the company reported lower copper concentrate production because of lower processing of concentrates and an anode inventory build-up caused by a planned shutdown at the company’s Głogów I smelter/refinery, which will begin next quarter.


The company, which also produces silver, reported consolidated sales revenue of PLN5.2bn ($1.2bn), down by 3pc from PLN5.4bn due to less favorable global economic conditions caused by the COVID-19 pandemic. The company’s copper sales also suffered in Q1 because of lower copper prices, especially in March when COVID-19 spread worldwide. The company reported its copper sales price fell to $5,637/mt in Q1 2020 compared with $6,215/mt in the same quarter last year.


KGHM’s EBITDA in Q1 2020 fell by 22pc to PLN1.12bn from PLN1.45bn in Q1 2019, although its group net profit rose by 25pc to PLN690mn last quarter from PLN552mn in Q1 2019. 


($1 = PLN4.22)

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