Anglo American Reports Significant Increases in Copper, Steelmaking Coal, and Iron Ore Production

Anglo American, a leading multinational mining company, has announced a substantial increase in production for the second quarter of this year. The company reported an 11% rise compared to the same period last year, primarily attributed to the successful ramp-up of their new Quellaveco copper mine in Peru.

Copper Production Soars by 56%

Anglo American’s copper production witnessed a remarkable surge of 56%, resulting in a total of 209,100 metric tons. This significant increase can be attributed to the production ramp-up at the Quellaveco mine. However, its operations in Chile experienced a slight decline of 2%.

In light of these developments, the production guidance for copper remains unchanged for 2023, with an estimated range of 840,000-930,000 tons. The breakdown includes projections of 530,000-580,000 tons for Chile and 310,000-350,000 tons for Peru. It is worth noting that water availability is a crucial factor affecting production in Chile.

Furthermore, the unit cost guidance for 2023 has been revised to approximately c.166 c/lb (previously c.156 c/lb). The change is mainly due to the strengthening of the Chilean peso. The cost per pound in Chile is now estimated to be approximately c.205 c/lb (previously c.190 c/lb), while in Peru, it is expected to be approximately c.100 c/lb.

Steelmaking Coal Production Experiences Substantial Growth

Steelmaking coal production at Anglo American saw a significant increase of 28%, reaching a total of 3.4 million tons. However, this growth was somewhat hindered by unseasonal wet weather conditions affecting the Capcoal and Dawson open cut operations in 2022.

The production guidance for steelmaking coal in 2023 remains unchanged, with an estimated range of 16-19 million tons. Similarly, there have been no revisions to the unit cost guidance for 2023, which stands at around c.$105/ton.

Iron Ore Production Shows Positive Momentum

Anglo American reported a 9% increase in iron ore production, totaling 15.6 million tons. This uptick was driven by a remarkable 29% increase at their Minas-Rio operation, partially offset by a minor 2% decrease at Kumba.

For the year 2023, the production guidance for iron ore remains unchanged with a projected range of 57-61 million tons. The breakdown includes expectations of 35-37 million tons for Kumba and 22-24 million tons for Minas-Rio. It is important to note that Kumba’s production is subject to the rail and port performance by third parties.

The unit cost guidance for iron ore in 2023 stands at approximately c.$39/ton. However, there have been slight revisions, with Kumba’s cost now estimated to be around c.$43/ton (previously c.$44/ton), reflecting the weaker South African rand. On the other hand, Minas-Rio’s cost is expected to be around c.$33/ton (previously c.$32/tonne), reflecting the stronger Brazilian real.

In conclusion, Anglo American’s remarkable production gains in copper, steelmaking coal, and iron ore highlight their continued success and commitment to meeting global demands across various sectors.

Nickel Production

Nickel production at Codemin experienced a 4% decrease to 9,900 tons. This decline can be attributed to lower grades, despite the implementation of operational improvements.

Nickel Guidance

The production guidance for nickel in 2023 remains unchanged at 38,000-40,000 tons.

However, the unit cost guidance for 2023 has been revised to approximately 560 cents per pound (previously around 515 cents per pound). This adjustment reflects the stronger Brazilian real and the impact of higher production costs resulting from lower grade ore.

Rough Diamond Production

Rough diamond production witnessed a 5% decrease to 7.6 million carats. This reduction was primarily due to the planned decrease in South Africa as the Venetia open pit undergoes a transition to underground operations. Nevertheless, strong performance was achieved through the intentional processing of higher grade ore across remaining assets.

Rough Diamond Guidance

The production guidance for rough diamonds in 2023 remains unchanged at 30-33 million carats (100% basis), subject to trading conditions.

Similarly, the unit cost guidance for 2023 has been revised to approximately $75 per carat (previously around $80 per carat). This change is influenced by the weaker South African rand.

Platinum Group Metals (PGMs)

Production from our platinum group metals (PGMs) operations experienced a 9% decrease. This decline was primarily driven by short-term operational challenges and the planned infrastructure closures at Amandelbult in 2022, as well as the planned ramp-down of Kroondal.

PGM Guidance

The production guidance for platinum group metals (metal in concentrate) in 2023 remains unchanged at 3.6-4.0 million ounces. As for refined production, the guidance for 2023 is also 3.6-4.0 million ounces, subject to the impact of Eskom load-curtailment.

Furthermore, the unit cost guidance for 2023 has been revised to approximately $1,000 per PGM ounce (previously around $1,025 per PGM ounce). This adjustment reflects the weaker South African rand.