Anglo American plc (LON:AAL) has trimmed its copper production estimates for the year after “unprecedented drought conditions” at its Los Bronces mine in Chile.
Los Bronces produced 80,400 tonnes of copper in the last quarter until the end of September, 16% less than the same period last year, which the FTSE 100 company blamed on lower water availability at the plant.
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This led to a reduction to the diversified miner’s annual production estimates to 630,000-650,000 tonnes from previous guidance of 630,000-660,000 tonnes.
The driest year of the longest drought ever recorded in central Chile also remains a risk for next year, Anglo said.
Overall copper production, which accounts for around 15% of the company’s annual profits, was down 8% to 158,900 tonnes in the last quarter.
But the diversified miner may weather copper’s storm, with iron ore production elsewhere up 4% thanks to a ramp-up at Minas-Rio in Brazil, which produced 6.1mln tonnes, increasing year-estimates for the mine to 20-22mln tonnes from a previous 19-21mln tonnes.
Other products, including platinum and palladium, remained broadly flat, and De Beers’ diamond production dropped 14% in the period ended 30 September due to weaker market demand.
Chief executive Mark Cutifani said Anglo American remains “broadly on track to deliver within full-year production targets” thanks to the increase in production guidance at Minas-Rio.
Cutifani added that copper and thermal coal will deliver “at the lower end of their ranges”, with copper “working to mitigate the effect of drought conditions in central Chile”.
Anglo shares, which are up 13% in the year to date, despite a fall in recent months, were struggling for direction in Tuesday morning trading, finding themselves flat at 1,939p after almost two hours.