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Growth in Peruvian copper production grinding to a halt
![Growth in Peruvian copper production grinding to a halt](https://cdnimg.bnamericas.com/RfmtrKyJcoKDUAqzSiibFEUWtNIIwKqEWACknhnhbyRXkWBsUZYrPhLuQiaHxHtw.jpeg)
The growth in Peru's copper production is slowing and it now seems unlikely that total output will exceed the 3Mt (million tons) projected for 2024.
After production rose 3.5% year-on-year in the first quarter, cumulative output in January-May was up just 0.01% compared with the first five months of last year after production slipped 8.2% year-on-year in April and 1.4% in May, with only three mines in the country showing sustained growth.
These figures were cited by the energy and mines ministry (Minem) in a report on the performance in January-May. The report shows cumulative output for this year reached 1.08Mt as of May 31, flat compared with January-May last year.
Meanwhile, 231,509t of copper was produced in May, down from 234,781t in May 2023.
BNamericas takes a look at the production figures from the major companies operating in the country.
Three mining companies currently provide most of the impetus for Peruvian copper production: Antamina, Southern Copper and Anglo American Quellaveco. Although they have seen ups and downs so far this year, all three have achieved above-average growth in output so far this year.
The mines operated by Antamina, which belongs to BHP (33.75%), Glencore (33.75%), Teck (22.5%) and Mitsubishi (10%), in the Áncash region of central Peru, produced 182,603t of copper in January-May, up from 167,854t in the same five months of last year. In May alone, the miner produced 47,741t, a 33% year-on-year increase.
Meanwhile, Southern Copper's copper output was up 11.5% year-on-year in May to 35,053t and rose 17.2% to 174,126t for the first five months of the year.
The company operates the Toquepala mine in the Tacna region and the Cuajone mine in the Moquegua region, both in southern Peru.
In the case of Anglo American, the operator of Quellaveco reported that its production slipped 3.7% to 26,306t, but increased 13.2% year-on-year to 123,936t in January-May, accounting for 11.5% of total national copper output.
OTHER COMPANIES
The situation was different for the rest of the copper companies operating in Peru. Cerro Verde, which is the leading copper miner in terms of production volume, saw its output slide 6.3% to 183,149t in January-May and there is little sign that it will turn the decline around in the short term.
The company, whose mine is in the Arequipa region, is responsible for over 17.0% of national copper production, but Antamina is close behind, contributing just under 17.0%, according to Minem, and will become the top producer if the trend continues.
Meanwhile, miners such as Las Bambas, Antapaccay, Marcobre and Chinalco together reported that copper production was down 10% year-on-year in January-May. Together, the four mines represent 26.2% of national production.
PERSPECTIVE
Currently, Minem expects copper production for this year to exceed 3Mt, but this forecast is subject to certain conditions and the scenario has changed.
Although Quellaveco is expected to operate at full capacity and churn out up to 350,000t/y of copper this year, Anglo has said that it will produce 300,000-330,000t. That would be similar to the figure for last year 319,000t, which is somewhat disappointing considering that the mine was undergoing optimization until June 2023.
Another additional push would come from Chinalco – which operates the Toromocho mine – where expansion works were due to finish in June. According to the ministry, the commercial operation of the expansion should begin this year, which would help it reverse the 12.9% contract in output seen in January-May.
Finally, although Las Bambas was expected to contribute a little more in 2024 due to the work currently underway at Chalcobamba – the mine's new pit – sector executives have said that the first phase will only be fully completed by the end of this year and not in July-August as previously planned, meaning that the additional output will not be seen until 2025.
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