Freeport increases 2002 copper output<\/p>\n
Dow Jones, Singapore<\/p>\n
Despite a more than 20 percent slump in global benchmark
\ncopper prices since beginning of the year, PT Freeport Indonesia
\nwill go ahead with plans to increase copper production next year,
\nthe company's president director said Monday.<\/p>\n
PT Freeport, which owns the world's largest copper and gold
\nreserves at its Grasberg Mine in Indonesia's Irian Jaya, expects
\nto boost output to 1.5 billion pounds of copper in concentrate in
\n2002 from 1.4 billion pounds this year, Adrianto Machribie told
\nDow Jones Newswires in an interview.<\/p>\n
Machribie's comments come at a time when most producers are
\nconsidering supply cuts as prices remain weighed down by sagging
\ndemand in a global economic slump exacerbated by the Sept. 11
\nattacks on the U.S.<\/p>\n
\"The events beginning Sept. 11 have obviously had a
\nsignificant impact on the world economy,\" Machribie said. \"(But)
\nwe believe the fundamentals for the long-term copper market still
\nlook good.\"<\/p>\n
He didn't provide any forecasts for global copper demand or
\nprices. But analysts predict a supply overhang of about 500,000
\nmetric tons for this year alone and that worse is still to come.<\/p>\n
Friday, the London Metal Exchange three-month copper price hit
\na fresh 33-month low at US$1,352 a metric ton, down from an
\nAugust average of $1,488\/ton. The contract's January average
\nprice was $1,794\/ton.<\/p>\n
Price weakness in recent months has prompted major copper
\nproducers to cut output in an effort to prop up prices. Last
\nmonth, for instance, U.S.-based Phelps Dodge Corp. (PD) announced
\nplans to cut 220,000 tons of output this year.<\/p>\n
A rally on the LME followed Phelps Dodge's announcement but
\nwas short-lived. Phelps Dodge called on other major producers to
\nfollow its example, as its planned reduction is less than half of
\nthe current surplus.<\/p>\n
\"Of course our bottom line is impacted by lower copper prices,
\nbut because of our high-production, low-cost structure, we're
\nable to generate significant operating cash flows despite
\ncurrently low commodity prices,\" Machribie said. PT Freeport's
\nnet cast production costs in 2001 are expected to average less
\nthan 10 U.S. cents a pound, he added.<\/p>\n
In the first nine months of this year, U.S.-based Freeport-
\nMcMoran Copper & Gold Inc., the parent company of PT Freeport,
\nrecorded operating cash flow of $475.1 million, up from $304.9
\nmillion in the same period last year.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/freeport-increases-2002-copper-output-1447893297",
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"sponsor": "Okusi Associates",
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