Chile revises Copper production forecast downward - Commerzbank

Chile's state-owned Copper producer estimates production losses at its El Teniente mine due to the tunnel collapse and the resulting production stoppage lasting several days at 20-30 thousand tons, Commerzbank's commodity analyst Carsten Fritsch notes.

Global demand for refined Copper is expected to rise by 2.4%

"As a result, Chile's Copper production could be further reduced this year. The state Copper commission Cochilco has already revised its production forecast for this year downward. It now expects an increase of only 1.5% compared to last year, to 5.58 million tons. Previously, it had assumed a growth rate of 3%."

"The downward revision was prompted by lower production in June at the Escondida mine, the world's largest, and at the likewise large Collahuasi mine. For next year, it continues to anticipate an increase of 3%, but from a lower level. Production is therefore expected to be only 5.75 million tons, which is 220,000 tons below the previous forecast. This could mean that Copper mine supply remains tight."

"In this context, Cochilco points out that growth in smelting capacity, particularly in Asia, is outpacing the increase in supply and that prices are therefore likely to remain above their long-term averages. Global demand for refined Copper is expected to rise by 2.4% to 27 million tons next year. Of this, 15.8 million tons are expected to come from China."