August 2017: Over the last weeks, copper has registered surprising variations that could lead to the revival of investment by yearend.
Between July 24th and 28th, the red metal registered an increase of 4.7% compared to the previous week and was US$2.85/ lb Cu, while during the first week of August the increase was 0.7%, to US$2.87/lb Cu.
According to a weekly report of Copper International Market, made by Cochilco, the highest price was empowered by the best expectations for the Chinese economy, the perception of world copper balance would be inadequate during 2017 and the downward trend of the dollar.
In order for the investment to reactivate, the price of metal must show stability. However, according to the VP of Codelco, Nelson Pizarro, “nobody is in a position to say how stable this increase in the price of copper is, but at least it is a good thing that allows us to continue the effort to generate spreads between prices and costs without changing our focus of controlling productivity”, he said during the inauguration of Antucoya plant.
Cochilco, meanwhile, has raised the price projection to US$2.64/lb Cu by 2017 and US$2.68/lb Cu by 2018. Projections for the first quarter of the year were US$2.60/lb Cu. Regarding the prospects for world copper demand for this year, during the presentation of the International Copper Market Trend Report (April – June), Cochilco VP, Sergio Hernández, said that growth is expected to be 1.5% (23.6Mt Cu) compared to 2016, 0.2% less than the estimates for the first quarter of the year. For 2018 the expected growth will be 1.6% (24Mt Cu).
Regarding Chilean copper mine production for 2017, Cochilco aims at 5.6Mt Cu, up 0.8% compared to 2016. By 2018 the agency projects a production of 5.9Mt Cu and a growth of 5,9% compared to 2017.