Antofagasta Forecasts Lower Production in 2022 as Drought Hampers Operations -- Commodity Comment
By Jaime Llinares Taboada
Antofagasta PLC on Wednesday reported copper production for the
third quarter and forecast lower output for next year, as drought
conditions continue in Chile. Here's what the mining company had to
On 3Q production:
"Group copper production in Q3 2021 was 181,100 tonnes, 1.5%
higher than in the previous quarter on higher production at
Centinela, partly offset by lower throughput at Los Pelambres"
"Gold production for the quarter was 66,800 ounces, 8.8% higher
than in the previous quarter, and for the year-to-date production
rose by 25.4% to 187,300 ounces, both increases as a result of
higher grades at Centinela"
"Molybdenum production in the quarter was 2,600 tonnes, 7.1%
lower than the previous quarter on lower grades and recoveries at
"Cash costs before by-product credits in Q3 2021 were $1.79/lb,
2c/lb higher than in the second quarter."
"The global energy and supply chain crisis over Q3 resulted in
higher commodity and therefore input prices, such as energy and
"However, evidence of wage inflation has been limited to
temporary hires mostly for projects while the labour market has yet
to recover to pre COVID-19 employment levels. The weaker Chilean
peso in Q3 has offset the higher input costs."
"Our copper production and cost performance during the quarter
was in line with our expectations despite external pressures such
as the ongoing drought in Chile, the global supply chain
challenges, the energy crisis and higher input costs."
On 2021 guidance:
"Copper production guidance for the full year of 710-740,000
tonnes is unchanged from the update provided in August. Net cash
costs are expected to be below the originally guided $1.25/lb"
"Accelerated mine development at Centinela and sustaining capex
at Los Pelambres have increased expected capital expenditure for
the year to between $1.6 and $ 1.8 billion. This level is similar
to current estimates for 2022 as sustaining and mine development
expenditure increase, and development expenditure continues"
"In 2022 copper production is expected to be 660-690,000 tonnes,
as grades decrease at Centinela Concentrates and assuming there is
no precipitation until the next rainy season and the desalination
plant comes into operation in H2 2022."
"Since we last reported, there has been no material rainfall at
our operations and as we head into the summer months, we do not
expect any rain until the next rainy season, which begins in June
Write to Jaime Llinares Taboada at email@example.com;
(END) Dow Jones Newswires
October 20, 2021 02:47 ET (06:47 GMT)
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