The global copper market faces a surplus of the metal that may push down prices toward the end of the year, according to the world’s biggest producer.
Codelco will boost supplies this year to 1.7 million metric tons from “under” that amount in 2012, Chief Executive Officer Thomas Keller said today in an interview from Davos, Switzerland. Chile’s state-owned company will also start its Ministro Hales copper mine this year, boosting supplies.
“Maybe there will be a certain element of downward pressure, albeit very slight, toward the end of the year when there will be a small surplus,” Keller said.
Chile’s copper supply is increasing after BHP Billiton Ltd. (BHP) boosted output at Escondida, the world’s largest copper mine, by 31 percent in the last quarter. Copper prices will stay at current levels for the rest of the year, Keller said.
Codelco’s customers are “cautiously optimistic” as the world economy improves, boosting manufacturing demand, he said. Copper is mostly used in power cables and electrical wire.
Copper futures for delivery in March slid 0.6 percent to $3.6825 a pound at 12:57 p.m. on the Comex in New York. Through yesterday, the metal gained 1.4 percent this month on signs of improving growth in the U.S. and China, the two biggest consumers of the metal.
On the LME, copper for delivery in three months dropped 0.1 percent to $8,103 a metric ton ($3.67 a pound).
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