October 8, 2013 / 3:48 PM / 4 years ago

UPDATE 2-LME WEEK-Chile ups copper output forecast, sees higher surplus

* Chile now seen producing 5.7 mln tonnes of copper in 2013

* Copper prices seen at $3.32/lb in 2013, $3.15 in 2014

* Chile raises copper surplus forecast by almost a third to 294,000

LONDON, Oct 8 (Reuters) - Chile raised its copper output forecast for 2013 and upped its global copper surplus expectations by around 40 percent, on soaring global production and slower demand growth, the country's mining minister said in London on Tuesday.

The country, the world's largest producer of copper, will produce about 5.7 million tonnes of copper this year, an increase of almost 5 percent on last year and a historic high, above previous estimates thanks to better output forecasts from key mines including Escondida, the world's largest.

State copper commission Cochilco in July had forecast the world No. 1 copper producer's output would reach 5.53 million tonnes this year.

Cochilco also raised its copper 2013 surplus expectations to 294,000 tonnes, up from its previous forecast of 209,000, due to higher production in Chile, the United States, Zambia and Indonesia and to lower demand for the metals from countries such as India, Taiwan and South Korea.

It expects the market surplus to increase in 2014 to 327,000 tonnes as new copper mining projects come on stream, in Chile and abroad.

The new estimate takes into account factors such as the stabilization of the Chinese economy and signs Europe is moving out of recession, said mining minister Hernán de Solminihac.

"The surplus estimate has increased but so has the price estimate for this year," he told Reuters in an interview.

"We are monitoring the situation to see what is going on and we have to manage what we can. We want to help Chile to become a more interesting place for foreign investors."

The country marginally raised its view for 2013 average copper prices to $3.32 per pound above the $3.27 per pound estimated earlier in the summer, after a better than expected performance in world markets during the third quarter.

It kept its 2014 copper price steady at $3.15 per pound.

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