Way back at the start of the year around 10% of the world’s copper output had production costs above the prices of the metal. Since then, the price of the red metal, Chile’s main export and a key part of the country’s economy, has fallen to levels not seen since the 2008-2009 financial crisis.
Faced with the slump in copper and other metals, mining companies in Chile and around are taking increasingly drastic but necessary measures to ensure their survival in these tough times. Reducing costs has been the industry mantra for at least a couple of years. But with copper prices hitting breakeven levels for many companies, the task become urgent. Codelco CEO Nelson Pizarro said that the company was adopting a “war economy” in order to minimize damage as it traverses the storm.