Key producer faces challenges

Decreasing grade in Chile impacts production and costs

Between 2000 and 2014 the average grade of oxide ore mined in Chile fell by 39% and sulphide ore grade by 37%.

Coupled with lower recovery rates, that meant a 119% increase in ore mined in Chile for just 19% more copper.

Source: Chilean Comision Nacional de Productividad

Together with increasing strip ratios at older mines and decreasing labour productivity this has pushed up the average cost of production in Chile.

Increasingly, as Chile grapples with these challenges, the copper market must look elsewhere for new supply, and Avanco’s Brazilian projects are well positioned for this.