Key Takeaways:
Antofagasta PLC held second-quarter copper production broadly steady from the prior quarter and reaffirmed its full-year output target, betting on higher ore throughput and improving grades at its two largest mines to drive a pickup through the remainder of the year.
"Copper fundamentals remain strong, with record prices during the period reflecting robust demand and an increasingly constrained supply outlook," Chief Executive Ivan Arriagada said.
The London-listed miner produced 142,000 metric tons of copper in the three months ended June 30, down 0.7% from the first quarter, as lower output at its Antucoya mine offset steady operations at Los Pelambres and Centinela. Net cash costs rose about 26% to $1.36 a pound, reflecting higher fuel and consumable prices tied to the broader energy cost environment. First-half copper output totaled 285,000 tonnes, down 9% from a year earlier.
Copper prices hit record levels during the quarter, supported by robust demand from electrification and data-center buildout and an increasingly constrained supply outlook as existing mines age and new projects face long development timelines. Antofagasta's full-year guidance of 650,000 to 700,000 tonnes implies a significant ramp in the second half, with quarterly output expected to increase sequentially. The company also maintained its net cash cost forecast of $1.15 to $1.35 a pound after by-product credits, though it now expects cash costs before credits of $2.40 to $2.60 a pound.
Los Pelambres and Centinela Drive Second-Half Outlook
The production ramp hinges on Los Pelambres and Centinela, where the company expects higher ore throughput and improving grades. Around 7,000 tonnes of copper processed at Los Pelambres during the quarter remained in plant inventory following extended concentrate pipeline maintenance and will be recognized as filtered production in the second half.
Second-quarter gold production was 46,300 ounces, down 0.4% from a year earlier, with output levels unchanged at both Los Pelambres and Centinela. First-half gold output of 92,800 ounces was flat year-over-year. Molybdenum production reached 3,100 tonnes in the quarter, up 3.3% from the prior period, though first-half output of 6,100 tonnes was down 18% year-over-year due to lower production at Los Pelambres.
Peer Context and Industry Backdrop
Antofagasta's performance comes as the broader mining sector navigates elevated energy costs and operational headwinds. Rio Tinto Ltd., the world's largest iron ore producer, reported second-quarter copper output of 213,000 tonnes, down 7% from a year earlier and slightly below consensus, citing a furnace outage at its Kennecott mine and lower grades at Chile's Escondida. Rio Tinto cut its 2026 copper unit cost forecast to between 30 and 50 U.S. cents per pound from 65 to 75 cents, citing higher gold by-product credits and productivity gains.
This article is for informational purposes only and does not constitute investment advice.
