PRLog (Press Release) – Jun 09, 2011 – Chile's mining sector faces a series of challenges over the coming months as growing fears of a slowdown in Chinese economic growth, dictated by the country's increasingly restrictive monetary policy, threatens to restrict demand for copper and other raw materials. Nevertheless, we remain confident that the mining industry is primed for substantial growth over the next few years and expect a substantial increase in silver, copper and especially gold output over the forecast period to 2015. Growth is likely to peak in 2012 and 2013 as several new expansion projects come to fruition.
Copper Sector To Overcome Short-Term Obstacles
Copper remains the most important sub-sector within Chile's mining landscap rc helicopter market place e, accounting for 42% of the country's total export revenues in 2009. Over the short term, we warn that Chile's copper production is likely to be restricted by falling grades at some of the largest mines, including Collahuasi and Escondida, leading us to revise our output forecast downwards in Q311. However, we expect a significant boost in output over the medium term as several expansion plans come online.
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The most recent data from Chile's National Statistics Institute (INE) indicate that the country's copper production fell by 6.6% y-o-y in February 2011, marking a 0.1% y-o-y decrease for the first two months of the year to 817kt. The decline in output in February was due to un manual trash compactor scheduled maintenance at BHP Billiton's Cerro Colorado mine and falling grades at the joint venture between BHP and Rio Tinto at the Escondida mine. In addition, lower grades reduced production at the Collahuasi mine, a joint venture between Xstrata and Anglo American.
The long-term prospects for copper production look positive, however, with several expansion projects expected to come online over the medium-term. The largest expansion project is at the Collahuasi mine, where output will increase from 535ktpa to over 1mtpa by 2014. Anglo American also plans to increase output by 50% to 300ktpa at its Los Broncos mine by 2012. Overall, we expect Chile's copper production to grow at annual average rate of 4.9% over the forecast period, reaching 6.87mnt in 2015, up from 5.42mnt in 2010.
Regulatory Environment
Chile has the rare combination of a very favourable business environment and substantial mineral reserves. The increased mining tax from 4-5% of operating profit to 4-9% has so far been met by little opposition from miners, either local and overseas. In addition, Chile's reserves of copper and gold are likely to outweigh any concerns over tax rates. Overall, Chile will remain a highly attractive country for foreign investment as the centre-right government is eager to maintain foreign direct investment (FDI) flows into the country. That said, we expect Chile to tighten its safety laws after the collapsed mine at San Jose that highlighted the lack of regulation in the mining sector in the country.
Key Players
Chile's mining sector is dominated by the state-owned Codelco, as well as Xstrata, Anglo American and Antofagasta, which operate almost all the largest copper mines. We expect the silver mining sector to become more fragmented, with Genesis Minerals and Laguna Resources developing large deposits. Gold and copper production is likely to remain consolidated, with the largest companies continuing to dominate output and exploration.
Partial Table of Contents:
SWOT Analysis
- Chile Political SWOT
- Chile Economic SWOT
- Chile Business Environment SWOT
Global Mining Outlook
- Table: Main Frontier Mining Projects
- Table: Lower Grades At Key Mines
- Table: Uranium Developments
- Table: Regulatory Issues
- Table: Other Developments
Industry Trends And Developments
- Table: Mining Sector Growth, 2008-2015
Business Environment
- Latin America Mining Business Environment Ratings
- Table: Americas Mining Business Environment Ratings
Political And Economic Outlook
- Domestic Politics
- Macroeconomic Outlook
- Table: Chile - Economic Activity, 2008-2015
Industry Forecast
- Copper: Falling Grades In Short Term, Long-Term Expansion
- Table: Largest Copper Mine Expansion Plans
- Table: Copper Production, 2008-2015
- Gold Production On Course For Rapid Growth
- Table: Gold Mine Major Expansion Plans
- Table: Gold Production, 2008-2015
- Silver: Pascua Lama To Drive G trash bins rowth In Silver Production
- Table: Major Silver Mine Expansion Plans
- Table: Silver Production, 2008-201 garbage compactor review 5
Regulatory Development
Competitive Landscape
- Table: Mining Companies' Financial Data, December 2010
Company Monitor
- Antofagasta
- Codelco
- Xstrata
Commodities Forecasts
- Aluminium
- Copper
- Gold
- Lead
- Nickel
- Tin
- Zinc
- Table: Global And Regional Real GDP Growth, 2010-2013 (% change y-o-y)
- Table: Selected Exchange Rates, 2010-2013 (average)
- Developed States
- Table: Developed States' GDP Growth, 2010-2013 (% change y-o-y)
- Emerging Markets
- Table: Emerging Markets' GDP Growth, 2010-2013 (% change y-o-y)
- Consensus Forecasts
- Table: Bloomberg Consensus GDP Growth Forecasts, 2011-2012 (% change y-o-y)
Country Snapshot: Chile Demographic Data
- Section 1: Population
- Table: Demographic Indicators, 2005-2030
- Table: Rural/Urban Breakdown, 2005-2030
- Section 2: Education And Healthcare
- Table: Education, 2002-2005
- Table: Vital Statistics, 2005-2030
- Section 3: Labour Market And Spending Power
- Table: Employment Indicators, 2001-2006
- Table: Consumer Expenditure, 2000-2012 (US$)
- Table: Average Annual Wages, 2000-2012
Full Table of Contents is available at:
-- http://www.fastmr.com/catalog/product.aspx?productid=169 ...
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