Codelco's Copper Challenges Amid Exchange Rate Woes

Chilean miner Codelco, the largest copper producer globally, reported a slight first-quarter production increase, but a significant 53% profit decline due to exchange-rate effects. Increased operational costs also impacted profits. Key developments include upcoming production at El Teniente and Rajo Inca mines.

Chilean miner Codelco, the world's largest copper producer, announced a marginal production rise in the first quarter on Friday. However, this uptick wasn't sufficient to counterbalance the adverse effects of exchange rates, which led to a sharp 53% drop in pre-tax profits, falling to $213 million.

The state-owned company's output rose by 0.3%, amounting to 296,000 metric tons, with overall production reaching 324,000 metric tons, including stakes in other projects. Despite these figures, efforts to boost annual copper production between 1.37 million and 1.4 million tons follow a 25-year low.

Challenges such as rainfall and a nationwide blackout in February hindered production by 10,000 tons. Codelco reported a nearly 12% drop in core earnings (EBITDA) to $1.35 billion, affected by currency depreciation and increased operational expenditures for maintenance and equipment leases.

(With inputs from agencies.)