Chile Raised Its 2022 Copper Price Forecast to $9,700 a Tonne

Chile's copper commission, Cochilco, on Thursday raised its 2022 copper price forecast to $4.40 a pound, or $9,700 a tonne, because of the scarcity caused by the conflict between Russia and Ukraine.  

In January, Cochilco kept its copper price forecast at $3.95 a pound. It said the growth was influenced by economic factors, "principally by the reduction in metals market inventories and the risk that global metals supply will fall short of expectations".  

Mining Minister Marcela Hernando told reporters that while the price increases are good for Chile, "not all of them will be reflected in taxes because fuel prices, steel, maritime transport and mining supplies will also go up."  

Victor Garay, coordinator of mining markets at Cochilco, said the upward forecast could be revised in the coming months if the conflict with Ukraine results in copper supply constraints or higher oil and energy prices in Russia.  

Cochilco expects a price of $3.95 a pound in 2023, up from its January forecast of $3.80.  

Chile is expected to produce 5.78 million tons of copper in 2022, up 2.6% year on year. According to Cochilco, the global refined copper market will suffer a shortage of 104,000 tonnes this year, putting downward pressure on metals exchange inventories. By 2023, however, the market is expected to have a surplus of 329,000 tonnes.