Skyline in Chile

Chile Commodities October 2019

Chile: Copper prices stable in October

Copper prices were stable in October, averaging USD 2.61 per pound (equivalent to USD 5,757 per ton). Meanwhile, prices for the red metal were 7.4% lower than the same month last year and down 3.1% on a year-to-date basis.

Copper prices fell during the first week of October after the U.S. announced plans to impose tariffs on some European goods, stoking fears of a deepened global economic slowdown which has weighed on copper demand. Bleak factory data in major industrial nations and a strong dollar further weighed on prices. Later in the month, however, prices climbed due to investor concerns over supply-side issues in Chile. Production was halted at several operations, including at BHP’s Escondida copper mine—the world’s largest—where workers joined the nationwide anti-government protests.

Looking ahead, despite the recent surge in prices, demand concerns amid the weak global backdrop and trade war uncertainties will continue to dictate the market. Thus, in the short-run, copper prices are likely to remain below the USD 6,000 per metric ton mark. That said, further ahead the outlook appears brighter as refined production lags behind usage, amid limited production capacity and increasing demand for copper in new technologies such as electric vehicles and green-energy projects.

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