Antofagasta says copper market may be stabilising

Antofagasta said first quarter copper production rose 7.3% year-on-year to 157,100 tonnes, adding that movements in the copper price over the period suggesting the market was beginning to stabilise.

“However, with price growth likely to remain subdued in the near term our focus continues to be on operating safely, efficiently and profitably," the company said in a trading statement.

The production results include the first full quarter of production from Zaldívar and increases at Antucoya offset by lower production at Centinela Cathodes, as grade declined.

First quarter gold production rose 1.8% to 56,700 ounces against the last quarter of 2015 largely due to higher gold recoveries at the Centinela mine.

The company said group production and cash cost guidance for the full year was unchanged with an improvement in throughput expected at Los Pelambres and Centinela Concentrates, and in copper grade at Centinela Concentrates together with the continued ramp-up of Antucoya.

Copper production in the quarter was 7.5% lower against the fourth quarter of 2015 despite the production from Zaldívar and Antucoya following extended maintenance during the quarter at Los Pelambres coupled with lower production at Centinela Cathodes and no production from Michilla

Cash costs before by-product credits in the first quarter were $1.72 per pound, 6% lower year-on-year, but 4.2% higher than the fourth quarter of 2015.

“The increase from Q4 2015 is mainly related to lower production offset by cost savings and lower input prices, particularly energy,” the company said.

“Net cash costs were better than expected at $1.37/lb in Q1 2016, a 4.2% decrease compared with Q1 2015 with a significantly higher realised gold price offsetting the impact of lower production.”