Chilean Copper Commission reports rise in costs for large miners

The Chilean Copper Commission (COCHILCO), a state-owned copper mining company in Chile, has recently released its cost and production figures for the first quarter of 2023 (Q1CY2023).

Cash and net cost

Cash cost is an important indicator of short-term competitiveness and is used as a benchmark for management purposes, comparing countries, operations, and corporate groups. In Q1CY2023, the net cash cost increased to US cent202.9/lb from US cent157.4/lb in Q1 CY2022, representing a significant y-o-y surge of approximately 29%.

The increase in cost happened because of lower copper production, rising prices of materials, electricity, and fuel, as well as higher treatment and refining charges (TC/RC). However, there was a decrease in the cost of sulfuric acid, and higher credits were obtained from the sale of molybdenum and gold.

Among the 19 companies analyzed, the cost increased to US cent209.8/lb, while three companies managed to reduce their costs to around US cent153.2/lb in Q1CY2023.

Similarly, the net cost stood at US cent301.3/lb in Q1CY2023, compared to US cent251.8/lb in the same period last year. The gap between the price of copper and Cochilco's net cost decreased by US cent98.1/lb, dropping from US cent201.7 to US cent103.6/lb.

Production

This report presents the quarterly monitoring of Cochilco, which analyzes a sample of 22 prominent copper mining companies representing a total production of 1,163,000 tonnes. It is worth noting that there has been a remarkable 93.1% increase in mine production during Q1 CY2023.

Among these companies, BHP stands out with a significant share of production, reaching 258,000 t. This represents a noteworthy 11.2% y-o-y increase compared to the first quarter of CY2022. Following closely behind is Anglo American, contributing 130,000 t to the overall production.