Chile: Copper miner Codelco posts weak performance in H1CY23
Codelco, Chile’s state miner, posted weak results in the first half of 2023 (H1 CY’23). The company faced challenges in the last three months, with a ...
Codelco, Chile's state miner, posted weak results in the first half of 2023 (H1 CY'23). The company faced challenges in the last three months, with a drop in the realisation price of copper by 19% and a 36% decline in molybdenum prices, partially offset by an 8% improvement in direct costs.
The operational conditions and project delays resulted in a 14% decrease in copper production in January-June compared to the same period in 2022. Codelco's total production, including its affiliates El Abra and Anglo American Sur, reached 684,000 tonnes (t).
The drop in surpluses compared to the previous year was due to lower sales volume (11%), lower copper production (14%), and a 3% decrease in copper sales prices. Additionally, selling costs increased due to variations in production costs.
Codelco's EBITDA for the first half of 2023 stood at $1,775 million, with a margin of 21%. However, this marked a difference of 53.3% compared to the previous year, affected by similar reasons as the surpluses.
CY23 copper output forecast revised
Furthermore, Codelco recently announced a cut in its copper output forecast for 2023 and anticipated more halts in production in the second half of the year. A recent rock explosion accident at El Teniente, the company's largest mine, has impacted the project developments and productive areas, leading to lower production. As a result, the yearly copper production forecast was adjusted to 1.31-1.35 mnt.
Amid these challenges, Codelco's Chief Executive Andre Sougarret decided to step down by the end of August, and the company is yet to name a successor. Codelco remains a crucial player in the global copper market, and its performance will continue to be closely monitored as it navigates through both operational and market complexities.