July 25, 2018 / 7:07 AM / 9 months ago

UPDATE 1-Antofagasta sticks to 2018 targets as Q2 copper output rises

(Updates with detail)

LONDON, July 25 (Reuters) - Antofagasta on Wednesday reported a 6.1 percent increase in second-quarter copper production and a fall in costs, a trend the miner said would to continue for the rest of the year.

Copper production rose to 163,200 tonnes while cash costs fell by 7.5 percent to $1.85 per pound, helped by a weakened Chilean peso and higher production at its Centinela mine.

Antofagasta, majority owned by the wealthy Luksic family, stockpiled its copper concentrates in the period after it discovered a blockage in the pipeline that carries output from its Los Pelambres processing plant to the port.

Chief Executive Iván Arriagada said net cash costs are expected to fall in the second half due to higher grades and by-product volumes while production is expected to rise as concentrate is moved to the ports.

Antofagasta stockpiled about 9,200 tonnes of copper after discovering the blockage in May.

Full-year production guidance was maintained at between 705,000-740,000 tonnes and net cash costs at $1.35 per pound, as the second half of the year is expected to improve on the first half.

“With the smaller operations appearing challenged at the moment, achieving much more than the bottom end of guidance could be a stretch,” BMO Capital Markets analyst Edward Sterck said, warning that output would have to jump at least 22 percent to meet targets. (Reporting by Zandi Shabalala; editing by Jason Neely and Louise Heavens)

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