SANTIAGO – The Chilean Copper Commission, known as Cochilco, on Thursday revised downward its expectations for the average copper price in 2015, to $2.85 a pound from the $3.00 a pound it forecast in October.
Chilean copper production is expected to be 6 million tons this year, down from the 6.23 million tons Cochilco projected in October.
Chile is the world’s largest copper producer and each one-cent increase in the price of the red metal represents more than $40 million in additional government revenue.
“The fall in oil prices, the strengthening of the dollar in international markets and the gradual slowdown affecting China’s economy led Cochilco to trim their expectations,” Mining Minister Aurora Williams said.
“All these factors coincide with an abundant supply of metals that has exacerbated investors’ risk aversion regarding raw materials, precipitating the fall in prices,” she said.
Speaking at a joint press conference with Cochilco executive vice-chairman Sergio Hernandez, Williams said that “just as the IMF” warned in its most recent world economic outlook, those negative factors probably will deepen over the course of this year.
The chairman of state-owned copper company Codelco, Oscar Landarretche, told Radio Cooperativa that in the next few days his firm will unveil “a package of aggressive steps to cut costs.”
Codelco is the world’s largest producer of the red metal, with output of 1.7 million tons a year.