BMI View: Chile's mining sector will see modest average annual growth of 1. 6 % in 201 5 -201 9 . T he country's stable political and business environments , combined with its significant mineral reserves , will encourage continued investment . Nevertheless, older mines will still face lagging productivity, while subdued copper and precious metal prices will limit sector growth and miners' expansion plans .
The Chilean mining sector will be dominated by copper production for the foreseeable future. In 2014, the metal accounted for approximately 92% of mining exports as measured in dollar terms and nearly 55% of the country's total exports. However, the latter represents a decline from 2010, when copper accounted for slightly over 58% of the country's total exports. Ultimately, we expect the mining industry to be hit by lower copper prices, which we forecast will see only a modest recovery in the years ahead. For 2015, we forecast prices will average USD5,750/tonne. Still, the pipeline of copper projects and the country's global dominance in copper production will ensure the country maintains its lead despite falling ore grades and lagging productivity. Moreover, lower oil prices and a weaker Chilean peso on the back of US dollar strength will cap growth in input costs, providing a boon to miners facing subdued metal prices.
Further Investment, But Only Modest Sector Growth
State-owned Codelco will remain Chile's largest copper miner as measured in output, and indeed the largest copper miner globally, through 2019. The company recently pushed back its forecast for 2.0mnt of copper output annually to 2025 though, from its earlier target of 2020, due to disagreements with the Chilean government over annual investment levels. While the Chilean government recently agreed to provide USD4bn of financing to 2018, the firm also issued USD980mn worth of 30-year unsecured bonds in Q414 to raise additional funds for investment.
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The Chile Mining Report has been researched at source and features BMI Research's mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Chile Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Chile.
- Use BMI's independent industry forecasts on Chile to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Chile's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Chile.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.
BMI Industry View
Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.
Industry SWOT analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
- Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
- Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
- Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.
BMI’s Mining Risk Reward Index
BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
Competitive Landscape Tables & Analysis
Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.
Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.