Output at the Chilean mining conglomerate Antofagasta is likely to come in at the lower end of the firm’s guidance in its full year results, the firm has said, despite copper production rising by 20 per cent between April and the end of June.
The FTSE 100 constituent, which runs copper and gold mines in Chile and owns equity in railroads and other exploration ventures, saw its copper and gold production both rise between the first and second quarters of 2024.
Copper production jumped from 129 kilotonnes at the start of the year to 155Kt in the second quarter, thanks to its Los Pelambres site, where pipeline maintenance and cleaning activities were completed halfway through the first quarter.
Gold production also rose marginally between the two quarters, up 0.9 per cent to 33.6 kilo ounces.
But despite the quarterly increases, production was down considerably year-on-year, due to lower production from Centinela concentrate. Copper production was four per cent down on last year.
Antofagasta now expects total production for 2024 to come in at the lower end of its 670-710,000 tonne guidance range.
The copper price has been highly volatile over the reporting period, with investors seeing it as a crucial metal in the transition to electrification. The metal’s performance has been in stark contrast to last year, when the steady demand and supply led to a stable copper price which helped London-listed like Antofagasta.
Antofagasta’s CEO, Iván Arriagada said: “With a 20% increase in copper production in the second quarter, output in H1 2024 was close to the same level seen in H1 2023, despite lower grades at both Los Pelambres and Centinela.
“Los Pelambres achieved higher ore processing volumes in the second quarter following the recently completed Phase 1 Expansion Project, and for the second half of the year, production is also expected to include drawdowns from Los Pelambres’ concentrate inventories that accumulated in February 2024.
“At Centinela, production in Q2 2024 also reflected lower recoveries that were impacted by elevated levels of clay and fines in ores processed. Considering the above, we expect that full year production will be in the lower end of our guidance range of 670-710,000 tonnes, with cash cost guidance adjusted.”