Codelco, a copper mining firm owned by the government of Chile has increased its production in an effort to meet this year’s targets. Copper is a critical metal, given its use in the green energy revolution and the increase in use of electric vehicles.
The company, which is the biggest producer of copper globally, is trying to revive output following a weak first half of the year and a more than two decade low.
Sources reveal that the company hopes to close 2024 with 1.33 million metric tons of copper, a 0.5% increase from its 2023 figure. In an internal memo, Codelco explained that its output in October was 2.9% higher than the target, a sign of its recent strong performance.
Its plan for the year was to produce 116,500 tons of copper in October, so the above increase suggests that actual production is about 120,000 tons. The company’s official target for 2024 is between 1.325-1.352 million tons of the red metal.
Codelco hopes to increase copper production, which was affected by a drop in ore grades, accidents and construction mistakes at some mines. This comes as global demand for the metal increases and in turn, pushes prices higher. The company, which is also venturing into lithium, had a difficult start to 2024, starting with the death of Ana Camila Rojas Farias at the Radomiro Tomic mine.
The truck driver’s death ignited a strike among the workers with the aim of calling to attention to the lack of equipment maintenance and serious safety issues. This, they believe, was the cause of Rojas Farias’ death.
Delays on the Rajo Inca project didn’t help either, with analysts flagging risks to the company achieving its annual target. Despite this, Codelco has found a way to grow production, with executives becoming more bullish. Chairman Maximo Pacheco stated last month that October was the best month so far into the year and would be higher than the target.
To meet its end-of-year objectives, the company will have to produce more than 400,000 tons of the red metal in Q4. This is 20% higher than total production for Q3. It should be noted that official figures are yet to be reported.
Analysts note that even if the company succeeds though, its production is still lower than it was ten years ago.
GEM Mining Consulting’s CEO Juan Ignacio Guzman highlights that it is important to not lose sight of the fact that Codelco is going through a substantial crisis, whether or not it meets its objective.
Other enterprises like First Tellurium Corp. (CSE: FTEL) (OTCQB: FSTTF) are also working to bring more copper resources onto the market. The coming years could see the dominance of firms like Codelco being chipped away.
NOTE TO INVESTORS: The latest news and updates relating to First Tellurium Corp. (CSE: FTEL) (OTCQB: FSTTF) are available in the company’s newsroom at https://ibn.fm/FSTTF
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