Boston, MA -- (ReleaseWire) -- 06/13/2014 -- We forecast modest mining sector growth of 1.2% on average per annum in Chile through to 2018 , a downgrade from our last forecast to better reflect the effect of weaker copper prices on the sector . We anticipate m ajor miners will continue to develop several large projects, as the country's political and business environments remain stable and the country possesse s significant mineral reserves. Yet elevated operational costs, regulatory changes, and subdued copper and precious metal prices will limit sector growth and should result in more conservative expansion and acquisition plans among major miners .
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We expect copper production will remain the backbone of the Chilean mining sector for the foreseeable future, with copper accounting for nearly 60% of the country's total exports. The pipeline of copper projects and the country's global dominance in copper production will ensure the country's lead despite falling ore grades and more modest production growth. However, our forecast for both ample global refined copper supply to 2018 and slowing Chinese fixed asset investment growth, leads us to anticipate continued copper price declines over our five-year forecast period. Indeed, we see prices averaging lower on a y-o-y basis in 2014 at USD6,800/tonne. Despite weakness in 2013, copper prices remain elevated by historical standards, encouraging production for the time being as major miners and smelters maintain profitability.
Large & Mid-Tier Players To Continue Investment
We expect state-owned Codelco will remain Chile's largest copper miner, and indeed the largest copper miner as measured by mine output, through 2018. It forecasts average annual investment of USD4-5bn to 2020 as it seeks to increase average annual copper output to 2.0mnt. Other large global diversified miners, including Glencore Xstrata, Anglo American, BHP...
The Chile Mining Report has been researched at source and features Business Monitor International (BMI)'s mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Chile Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Chile.
- Use BMI's independent industry forecasts on Chile to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Chile's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Chile.
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