World’s largest copper producer Codelco plans recovery in 2024 after production decline

Codelco, the world’s largest producer of copper, anticipates a rebound in copper production starting from 2024 after an unexpected significant drop this year, according to its president, Máximo Pacheco.

Pacheco stated in an interview that he believes production will begin to rise from this point onward.

This comes after the state-owned giant reduced its annual production outlook to the lowest level in 25 years and increased cost estimates following a disappointing quarter.

The decrease in production has accelerated due to delays in projects and setbacks in mines.

Pacheco noted that project delays are more related to execution rather than lack of funding.

As the mineral grade decreases, it becomes more challenging and costly for the copper industry to exploit new deposits amid supply chain disruptions, inflation, and construction bottlenecks.

However, Pacheco assured that Codelco’s annual investment of US$3.5 to US$4 billion would guarantee production for the next five decades.

He mentioned that the company is optimizing projects and decentralizing decision-making in some areas.

Codelco also became a significant player in the lithium industry after the President of Chile, Gabriel Boric, assigned the company to represent the state in a new public-private participation model.

Conversations with Chile’s largest lithium producer, SQM, are progressing towards an agreement expected by the end of the year.

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