Chile's state-owned copper giant Codelco has reported another sharp fluctuation in production figures, sparking market doubts about the authenticity of its year-end surge and the credibility of its long-term output growth targets.
According to data from the Chilean Copper Commission reported by Reuters on March 17, Codelco produced 91,000 tonnes of copper in January, representing a 47% decline from December's 172,300 tonnes and a 1.8% decrease compared to the same period last year. This significant drop follows the company's report of its highest monthly output in a decade during December, which far exceeded the average production of 105,600 tonnes from January to November.
The stark discrepancy has prompted industry insiders to question how the production data was compiled. The report cited four former Codelco executives who expressed skepticism about both the December figures and the company's 2030 production target. Codelco maintains that the production increase is genuine, attributing it to inventory drawdowns and operational improvements at certain mines.
Former executives were among the first to voice concerns. "The entire industry adjusts data to better meet targets, but the gap here clearly warrants questioning," one anonymous former executive told Reuters, adding that it also reflects inadequate planning. Horizonte Mining CEO Juan Ignacio Guzmán noted that while year-end production pushes are common in the industry, such extreme fluctuations could signal either a warning or statistical methodology changes.
An internal Codelco production document obtained by Reuters showed that the Chuquicamata mine produced 25,000 tonnes of copper oxide in December, more than six times the forecast of 4,000 tonnes. The Andina mine recorded its highest monthly output since 2014, while the Salvador mine produced 11,500 tonnes, significantly exceeding the projected 4,600 tonnes.
Codelco attributed the December production surge to three factors: drawing down heap leach inventories, utilizing unplanned inventory sources, and improved operational performance at certain mines. The company stated that Chuquicamata's increased output resulted from full utilization of heap leach stocks, while Andina's production jump came from improved ore grades and processing efficiency. The Salvador mine's growth was linked to the Rajo Inca project's ramp-up and inventory releases accumulated during the Potrerillos smelter shutdown in June.
Codelco emphasized that these results demonstrate the company's technical and human resource capabilities to maintain production under challenging circumstances.
The controversy highlights deeper structural pressures facing Codelco. The company's copper output fell to a 25-year low in 2023 due to declining ore grades and delays in key mining projects. While production recovered somewhat in 2024 and is projected to reach 1.33 million tonnes in 2025, this still falls significantly short of its 2030 target of 1.7 million tonnes.
Industry analysts cited by Reuters suggest that the dramatic December surge followed by January's sharp decline has made markets cautious about Codelco's ability to achieve sustainable structural production growth, casting further doubt on the credibility of its 2030 target.
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