 Philip Whiterow
08:23 Wed 18 Jan 2023
Antofagasta upbeat as copper price rallies and production recovers
"The recent strength in the copper market is a positive start to the year"
Copper Fourth quarter copper production was 195,700 tonnes, up 7.6% on the previous three months
Antofagasta PLC (LSE:ANTO) said it ended 2002 on a strong note with higher copper prices, production rising, and cost pressures stabilising.
Production for the year just ended was 646,200 tonnes of copper, in line with the bottom of revised forecasts, with the Chile-based miner forecasting that to increase in the current year.
“With the Los Pelambres desalination and concentrator plants expected to be in production during the second quarter of the year after finishing commissioning, we forecast annual copper production in 2023 will increase to between 670,000 and 710,000 tonnes with net cash costs of $1.65/lb,” said Iván Arriagada, Antofagasta chief executive in the production update.
Fourth quarter copper production was 195,700 tonnes, up 7.6% on the previous three months as throughput at Los Pelambres and Centinela Concentrates recovered.
Gold production was 20% higher at 56,100 ounces (oz), making 176,800 oz for the year, which is expected to rise to 220-240,000 oz in 2023.
"The recent strength in the copper market is a positive start to the year, reflecting not just the relaxation of Covid restrictions in China and its expected stronger growth, but also the fundamental long-term importance of copper and the need for increased supply,“ Arriagada added.
Copper prices have recovered from US$3.24//lb in July to US$4.29/lb currently, while gold is close to an all-time high.
Antofagasta said it expects cash costs in 2023 to be $2.20/lb, in line with 2022, reflecting higher production and decreased input costs offset by inflation and a stronger Chilean peso
Net cash costs in 2023 are expected to be $1.65/lb including by-product credits.
Antofagasta shares rose 1% to 1,760p in early trade on Wednesday and are up almost 70% in four months.
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