Chile signals slow copper recovery from historic output slump
Chile expects its copper output to stage only a modest recovery next year after a historic slump, leaving it well below recent levels as aging mines contend with deteriorating ore quality and increasingly challenging geology.
State copper commission Cochilco cut its 2027 production forecast to 5.08 million metric tons, implying a 3% rebound. It also slashed this year’s estimate to 4.94 million tons from 5.27 million amid accidents and wild weather, representing an 8.4% annual drop.
The subdued outlook underscores the challenge facing a country that accounts for more than a fifth of global mined copper at a time when supply is struggling to keep pace with growing electrification demand. Chile’s output sank to its lowest quarterly level in at least two decades in the three months through September.
This year’s downturn has been concentrated at some of Chile’s biggest operations. Mines run by Codelco and BHP Group account for 77% of the net decline, according to Cochilco, which cited lower ore grades, maintenance and interruptions that have hurt processing and copper recoveries.
A muted Chilean rebound is nevertheless expected to play an important role in an improvement in global mine supply next year. Cochilco sees worldwide production recovering 3.4% in 2027 after contracting 0.6% this year, with Chile and the Democratic Republic of Congo together accounting for about 37% of the increase.
The refined market will remain tight even as supply improves, according to Cochilco. It forecasts a surplus next year equivalent to just 0.8% of consumption, leaving little cushion for further production disruptions or stronger-than-expected demand.
Demand for refined copper is expected to grow 1.5% this year and 1.8% in 2027, even as growth in China slows to 1% from 1.6%. Markets outside China are forecast to account for about two-thirds of next year’s global demand growth. Against that backdrop of constrained supply and resilient consumption, Cochilco raised its copper-price forecasts to $6.18 a pound for 2026 and $5.95 for 2027, from $5.95 and $5.10 previously.
(By James Attwood)
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