Peru Mining Report

Published 20 March 2015

  • 89 pages
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  • Includes 3 free updated quarterly reports
 
$1,295.00
Peru Mining Report

BMI View: Peru's mining industry value will grow 3.4% on average per annum in 2015-201 9 , reaching USD27.2bn . Both domestic and international firms will continue to develop mines , encouraged by the country's strong investment and regulatory framework for miners. Still, ongoing conflicts with local communities are likely to cause project delays and other operational difficulties.

Peru's mining sector should see further growth over the next five years on account of its significant untapped reserves and open investment framework. The Peruvian government estimates that the country's current mining projects pipeline totals over USD60bn, although continued protests by local communities are likely to cause project delays and increase costs. Moreover, subdued mineral prices due to slowing Chinese demand growth have dented the country's total mining exports in recent years. Nevertheless, Peru will still remain a significant global producer of several base and precious metals, and we expect continued diversification as miners explore and develop new deposits. Copper projects accounting for the largest proportion of new mine projects and expansions. The sector is dominated by global copper mining majors including Southern Copper (a division of Grupo Mexico), Freeport McMoRan and Glencore Xstrata, which are boosting output by both expanding existing operations and undertaking new investment projects.

Subdued Metal Prices To Be Continued Headwind
Peru - Mining Exports (USDmn) & Mining Exports % of Total Exports

We expect President Ollanta Humala to continue pursuing moderate policies, seeking to attract foreign investment while increasing social spending and implementing more accommodative policies towards Peruvian citizens and interest groups opposed to mining development. In response to the recent slowdown in mining exports and lower metal prices, the government has eased environmental and permitting regulations for miners in a bid to increase investment...

Table of Contents

BMI Industry View
7
SWOT
10
Industry Forecast
12
Copper: Growth Ahead Despite Environmental Concerns
12
Heady Growth To 2018
12
Table: Peru - Select Copper Projects
13
Downside Risks Remain
14
Table: Copper Production Forecast (Peru 2010-2018)
15
Gold: Subdued Production Growth To Resume In 2015
15
Sector Remains Vulnerable Over The Coming Quarters
17
Table: Gold Production Forecast (Peru 2010-2018)
17
Lead: Modest Growth In Coming Years
17
Positive Price Outlook, But Financing Crucial
19
Table: Lead Production Forecast (Peru 2010-2018)
19
Silver: Peru To Remain Second In Americas
20
Table: Peru - Key Silver Projects
21
Challenges To Persist
21
Table: Silver Production (Peru 2010-2018)
22
Tin: Production Declines To Continue
22
Minsur To Benefit From Tin Market Dynamics
23
Table: Tin Production Forecast (Peru 2010-2018)
24
Zinc: Peru To Maintain Dominance In The Americas
24
Table: Peru - Key Zinc Projects
26
Table: Zinc Production Forecast (Peru 2010-2018)
26
Industry Risk Reward Ratings
27
Americas Risk/Reward Ratings
27
Significant Rewards For Some, But Risks Abound
27
Weaker Prices To Remain Headwinds
28
Modest Shift In Rankings
29
Table: Americas - Mining Risk/Reward Ratings
30
Risk/Reward Ratings
30
Rewards
31
Industry Rewards
31
Country Rewards
31
Risks
32
Industry Risks
32
Country Risks
32
Table: Mining Industry Forecasts (Peru, 2012-2018)
33
Regulatory Development
34
Recent Developments
34
Balancing Between National & Local Goals
34
Open Investment Framework
34
Tax Regime
35
Endemic Corruption
35
Table: Peru - Political Overview
36
Table: Regional Regulatory Index
37
Commodities Forecast
38
Commodity Strategy
38
Ferrous Metals:
38
Steel: Prices To Remain Subdued
40
Non-Ferrous Metals:
41
Aluminium: Price Strength To Continue In Q314
41
Copper: Further Decline By Year's End
42
Lead: Constructive Price Outlook
43
Nickel: Moderation To Continue
44
Tin: Upside Ahead
45
Zinc: Consolidation Before Multi-Year Gains
47
Table: Select Commodities - Performance & BMI Forecasts
48
Competitive Landscape
50
Table: Financial Data - Key Mining Firms Listed In Peru
50
Gold & Silver Prospects Remain Tenuous
51
Company Profile
52
Buenaventura
52
Latest Results
54
Table: Buenaventura - Key Financial Data
54
Glencore Xstrata
55
Company Overview
56
Latest Financial Results
57
Company Strategy
57
Table: Glencore Xstrata - Supply Chain Analysis
59
Table: Glencore Xstrata - Key Financial Data
60
Grupo M-xico
61
Company Overview
62
Company Strategy
62
Latest Results
63
Table: Grupo M-xico - Key Financial Data
63
Address Details
64
First Quantum
65
Latest Results
68
Table: First Quantum: Key Financial Data
68
Regional Overview
70
Mexico & Peru To Remain Top Destinations
70
Canada To Lead North American Mining
72
Frontier Markets To See Little Development
74
75
Table: Estimated 2014 Production For Top Argentine Mines
76
Chinese Investment To Continue
76
Global Industry Overview
78
Capex Cutbacks To Yield Rewards
78
M&A Activity To Pick Up
80
High Grade Opportunities In Iron Ore
80
Shifting Centre Of Growth For Platinum
81
Chinese & Indian Outbound Mineral Investment To Gather Pace
82
Shake-Up For Global Rare Earths Industry
83
Methodology
85
Industry Forecast Methodology
85
Sources
86
Risk/Reward Rating Methodology
87
Table: Weighting Of Indicators
88

The Peru 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 Peru 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 Peru.

Key Benefits

  • Use BMI's independent industry forecasts on Peru to test other views - a key input for successful budgeting and planning in this mining market.
  • Target business opportunities and risks in Peru's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Peru.
  • 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.

Coverage

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.

Key Projects

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.

Company Profiles*

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.

Sources

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.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc