27 de noviembre de 2015 / 15:35 / en 2 años

UPDATE 2-Codelco copper production rises but possible cuts ahead

(Adds comments from CEO)

By Fabian Cambero

SANTIAGO, Nov 27 (Reuters) - Output at world No.1 copper producer Codelco rose slightly in the nine months to end-September, despite a sliding copper price, but its chief executive said it could make production cuts if the price falls much more.

The Chilean state-run miner produced 1.26 million tonnes of copper in January to September, a 2.3 percent rise from a year ago, it said on Friday.

However, pre-tax profit fell by nearly half compared to last year, to $1.2 billion, slammed by a fall in the price of the base metal, used in wiring and construction.

Cooling demand in key buyer China has driven the copper price to six-year lows with little prospect of a quick recovery, leading many miners to announce the suspension of work.

Codelco, which gives all its profits back to the state, has said it does not yet plan major production cuts, which has weighed further on the copper price.

But Chief Executive Nelson Pizarro said at a conference following release of the results that it has been evaluating “worst-case scenarios.”

“If copper prices fall significantly production could be cut,” he said, adding that he expected Codelco’s 2016 annual output to be roughly similar to this year’s and for the copper price to range between $2.05 and $2.50 a pound. It is currently trading at around $2.07.

Still, Pizarro said copper prices could fall further, beneath $2.00 per pound.

Cash costs of production in the nine month period were $1.38 per pound, down 10 percent from a year ago. Lower energy and fuel prices and a weaker Chilean peso have helped the company cut costs.

“There is room for further cuts,” Pizarro said. Cash costs would be lower in 2016 compared to this year, he added.

The company is seeking to implement an ambitious $22 billion multi-year investment plan to open new projects, like Ministro Hales, and revamp older ones, such as Chuquicamata, where output is declining. (Reporting by Fabian Cambero, Writing by Rosalba O‘Brien; Editing by Bernadette Baum and Phil Berlowitz)

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