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UPDATE 2-Chile Feb copper output up 8.0 pct vs yr ago
March 31, 2008 / 3:28 PM / 10 years ago

UPDATE 2-Chile Feb copper output up 8.0 pct vs yr ago

(Adds comment from Cochilco, details)

By Antonio de la Jara

SANTIAGO, March 31 (Reuters) - Chile, which provides about a third of the world’s copper, produced 423,201 tonnes of the metal in February, up 8.0 percent from the same month last year, the government’s National Statistics Institute said on Monday.

Chilean copper output totaled 439,123 tonnes in January.

“The increase in copper production is due mainly to ‘Category A’ firms (which have more than 400 workers), which accounted for 89.6 percent of the increase,” INE said in a statement.

Copper cathode output rose 1.1 percent during the period to 193,651 tonnes, while copper concentrate output rose 2.4 percent to 200,689 tonnes.

The output increase marked a reversal from recent months. Output had fallen each month since October.

State copper commission Cochilco attributed the increase to a lower base of comparison in 2007 and an extra day of production this February due to leap year.

“All the firms which come into that category, which are the biggest, and there are several, nearly all increased production during the period,” Raul Acevedo, head of Cochilco’s economic studies department, told Reuters.

“The month of February had another work day this year compared to last,” he added, saying the extra day could imply an output increase of around 3 percentage points alone.

“Also, last year some firms had output that was below the norm because of technical difficulties ... so this year looks higher.”

Chile is by far the world’s largest source of copper, a metal used in electrical wiring, plumbing, heating, air conditioning, roofing materials and car radiators, among other things.

Chile produced 5.588 million tonnes of copper in 2007, a rise of 3.8 percent over the previous year.

However, Chile’s state-owned Codelco, the world’s top copper producer, said last month it produced a total of 1.583 million tonnes of the metal last year, not including its stake in the El Abra mine, down 5.5 percent from 1.676 million tonnes in 2006.

Including the El Abra mine, Codelco said, it produced 1.665 million tonnes of copper in 2007, compared with 1.783 million tonnes in 2006.

Codelco’s output has receded in recent years as ore grades have fallen at its aging mines. In 2007, it was also hit by supply disruptions from a month-long subcontractors’ strike across its divisions.

For 2008, Codelco estimates output at all its divisions will be similar to last year. It expects start-up of its mine Gabriela Mistral to offset an expected shortfall at other divisions due to lower ore content.

Molybdenum output rose 4.3 percent in February from the same month last year to 2,834 tonnes, INE said. Chile is a top producer of the metal, which is used in high-strength steel alloys.

Prices for copper and molybdenum are near historic highs on global markets and have helped push up Chile’s trade surplus to record levels in recent years. (Writing by Simon Gardner; Editing by Walter Bagley)

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