Chile Mining Report Q2 2016

Date: March 2, 2016
Pages: 52
US$ 1,295.00
Report type: Strategic Report
Delivery: Download
ID: C31582DB2B1EN

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Includes 3 FREE quarterly updates

BMI View: Chile's mining sector will experience limited growth, as copper and gold prices remain weak over our forecast period to 2020.The country will remain the top global copper producer, although rising production costs and falling ore grades will curb output growth.

Latest Updates & Structural Trends
  • Chile, the largest copper producer, will experience relatively flat growth over 2016 to 2020, as weak copper prices and rising operational costs limit investment. We forecast Chile's annual copper production growth to average 1.6% over this period, increasing in volume from 6.0 million tonnes (mnt) in 2016 to 6.4mnt by 2020.
  • Chile's gold sector will experience limited growth over our forecast period to 2020 due to persistently low gold prices. We expect production to increase at an average y-o-y rate of 1.5% between 2016 and 2020, with output growing from 1.8moz to 1.9moz.
  • Elevated operating costs, notably water and power costs, will weigh on Chile's extractive sector, deterring investment particularly in light of lower costs in neighbouring Peru. While lower oil prices and a weaker Chilean peso on the back of US dollar strength will cap growth in input costs, providing a boon to miners facing subdued metal prices, the benefit will be outweighed by rising operating costs.
  • State-owned Codelco will remain Chile's largest copper miner as measured in output, and indeed the largest copper miner globally, through 2020. Nonetheless, the company recently pushed back its forecast for 2.0mnt of copper output annually to 2025, from its earlier target of 2020. The firm's USD22bn multiyear investment plan will continue to face project delays due to weak copper prices.
BMI Industry View
  Table: Chile Mining Industry Value Forecast (2014-2020)
Latest Updates & Structural Trends
Industry Forecast
Copper: Insufficient Water, Power To Weigh On Growth
  Table: Copper Production Forecast (Chile 2014-2020)
  Table: Chile - Major New Copper Projects & Expansions
Structural Trends
Gold: Weak Prices To Delay Projects
  Table: Gold Production (Chile 2014-2020)
  Table: Chile - Key Gold Projects
Industry Risk Reward Ratings
Chile Risk/Reward Index
Industry Rewards
Country Rewards
Industry Risks
Country Risks
Americas - Risk/Reward Divergence To Emerge
Key Takeaways
Latest Revisions
  Table: Americas - Mining Risk/Reward Index
Regulatory Development
Commodities Forecast
Commodities Outlook
  Table: BMI Commodities Price Forecasts
Competitive Landscape
  Table: Chile - Select Companies Financial Data, 2014
Company Profile
Antofagasta - Q2 2016
Latest Results
  Table: Enter table header
Codelco - Q2 2016
Latest Results
  Table: Codelco - Key Financial Data
Global Company Strategy - Anglo American - Q2 2016
Company Strategy
Latest Results
  Table: Anglo American - Financial Data
Regional Overview
Industry Forecast Methodology
Risk/Reward Index Methodology
  Table: Weighting Of Indicators
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