According to foreign news on June 7, at first glance, Chile's latest copper production seems to be in line with the recent supply disappointment. However, a closer look reveals that production in the country with the highest production may be improving.
While shipments fell 2.3 per cent in May from April, copper prices fell more than 6 per cent on average over the same period, according to data released by the People's Bank of China on Wednesday, suggesting shipments may have risen. The comparison with the same period last year was more promising, with revenues up nearly 7% despite a sharp drop in prices.
The data suggest that Chile's output may be stabilising after a series of project delays, mine-specific setbacks and plant maintenance. Previous monthly data showed a sharp rise in production in Peru and continued production at Congo's giant Kamoa-Kakula copper mine.
Stronger mine supply, coupled with fragile Chinese demand, helps explain why warehouse inventories are at a seven-month high.
