By Fabian Cambero and Daina Beth Solomon
SANTIAGO (Reuters) – Chilean state-owned company Codelco is making a belated effort to boost production in a bid to meet 2024 targets, two sources and an internal document said, potentially turning things around after a weak first half of the year.
The world’s largest copper producer, struggling to restart production after a 25-year low, hopes to end the year with about 1.331 million tonnes of the metal, the two company sources said, adding 0.5% would be more than last year. at the bottom of its target range.
In an internal memo seen by Reuters, the company said its October production, which executives already described as strong, was 2.9% above target, the most concrete sign yet of its recent performance. Official details will be released in the coming days.
The annual and October figures have previously not been reported.
The company’s official annual target is 1.325-1.352 million tonnes of copper, with the top end of the range lowered from 1.39 million tonnes in July.
The 2024 plan targeted 116,500 tonnes in October, an internal document seen earlier by Reuters showed. An increase of 2.9% would indicate a real production of almost 120,000 tons.
Codelco declined to comment.
Copper is crucial for electric vehicles and the global green energy revolution, with rising demand driving up prices.
LEADERSHIP ‘CERTAIN’ TO ACHIEVE GOALS
The miner, which is also spearheading the state’s lithium push, is fighting to revive its copper production, hit by construction defects at key mines, accidents and a decline in ore quality even as global demand for the metal rises.
The country faced a challenging start to the year, including delays at the Rajo Inca project at the small unit in Salvador and the death of a truck driver at Radomiro Tomic, prompting analysts to flag risks that could affect the annual would achieve objectives.
However, the company has implemented a major production boost in recent months, with executives becoming increasingly optimistic.
President Maximo Pacheco said on November 7 that October was the best month so far this year and would be ahead of target, without giving details.
One of the company sources said management was “confident” of coming within the annual production target range. The person said key mines such as El Teniente were in front of the target, while Salvador was behind it. The giant Chuquicamata was on course.
A second source confirmed production numbers and expectations. The final figure will depend on how quickly Codelco can ramp up production in the final period of the year.
Certainly, Codelco would have to maintain a breakneck pace to achieve its goals. More than 400,000 tons of copper would be needed in the fourth quarter, 20% more than in the third quarter.
Overall, even if this succeeds, production will still be well below the peaks of a decade ago, analysts said.
“Whether or not it meets its purpose, we should not lose sight of the fact that Codelco is going through a significant crisis,” said Juan Ignacio Guzman, head of Chilean mining consultancy GEM.
