Chile expects world copper glut 1996-2000<\/p>\n
SANTIAGO (Reuter): World copper supplies will swing from a
\nshortage this year to a glut for the rest of the decade thanks to
\nsteep rises in production especially from Chile and Indonesia,
\nsaid the Chilean Copper Commission, Cochilco.<\/p>\n
\"The growth in Chilean production is very opportune,\" said
\nAldo Picozzi, head of market research at Cochilco.<\/p>\n
\"The mines will benefit from good prices but not upset the
\nbalance of the market in the medium term,\" Picozzi told a news
\nconference Thursday.<\/p>\n
Cochilco estimates the world copper market will end this year
\nwith a deficit of 206,000 tons, far lower than 1994's shortfall
\nof nearly 500,000 tons, he said.<\/p>\n
Booming world output, led by a new generation of mega-mines in
\nChile's desolate Atacama Desert, combined with a slowdown in
\ngrowth in demand in the United States and Europe will lead to a
\nsteady fall in copper prices in the rest of the decade, he said.<\/p>\n
Cochilco studies show copper prices, which have averaged $1.33
\na pound this year, will fall to between $1.15-$1.20 next year and
\nto $1.00-$1.05 in 1997.<\/p>\n
Picozzi said prices will be in the $0.95-$1 range from 1998 to
\nthe end of the century.<\/p>\n
Lower prices will not affect the viability of Chile's new
\nmines, most of which are being built with low-cost solvent
\nextraction\/electro-winning (SX-EW) technology, said Picozzi.<\/p>\n
\"Prices are still good as costs are going down,\" he said. \"The
\nnew SX-EW mines will improve Chile's competitiveness.\"<\/p>\n
The SX-EW process, also known as heap-leaching, involves
\npouring sulfuric acid over mineral to extract the copper ore, by-
\npassing the traditional concentrator and smelter.<\/p>\n
Half<\/p>\n
With new SX-EW mines including Cyprus Amax's El Abra pit and
\nstate-owned Codelco's Radomiro Tomic mine coming on stream in the
\nnext three years, Chile will account for over half world
\nproduction of electro-won cathodes by 2000.<\/p>\n
The main Indonesian project in this period is the expansion of
\nthe Ertsberg copper mine.<\/p>\n
Cochilco estimates refined copper supplies in the western
\nworld will rise seven percent in 1996, with growth slowing to 2.5
\npercent a year.<\/p>\n
The exception is in 1998 when output will rise by more than
\n3.5 percent as projects including the giant Collahuasi mine,
\nowned by Canada's Falconbridge and Minorco, come into production.<\/p>\n
Collahuasi, which lies on a high desert plateau near the
\nborder with Bolivia, will churn out 380,000 tons of copper a
\nyear.<\/p>\n
Chile, already the world's largest copper producer, will see
\noutput doubling from 1994 levels to over 4.2 million tons by the
\nend of the decade.<\/p>",
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