Chilean copper capacity falls by 5.3% in 2019 The gap between the world's top two copper producers widened

Chilean copper industry Codelco, the world's second-largest copper miner, reported a 5.
3% drop in production in 2019 to 1.
588 million mt
, according to Mining.
com sources.

BHP Billiton, the world's largest mining company, produced 1.
749 million mt of copper in 2019 and is expected to produce between 1.
705 million mt and 1.
82 million mt in full-load production calculations by 2020 (Codelco remains at the top of the list on an equity basis).

Codelco, which handed over its entire revenue to the country, attributed the drop in production to unusually bad weather in the first half of the year, strikes at the Chuquicamata mine and operational problems
.

Full-year profit decreased 17% to $1.
34 billion compared to 2018, while direct cash costs increased 1.
8%.

Codelco said the poor financial results were due to lower gross margins, a downward trend in copper prices, lower physical sales of metals and molybdenum, and weak performance on related investments
.

Colin Hamilton, managing director of commodities research at BMO Capital Markets, had predicted earlier last week that the copper company would soon have to sell non-core assets
.

In a note to investors, Hamilton said: "Given the need to secure jobs, any idea of shutting down unprofitable operations is now off the agenda
.
”

Hamilton also noted that the likelihood of Codelco becoming the world's largest copper miner starting this year seems less and less likely, as depletion and restrictions are too much resistance
.

Currently, Codelco suspended a number of key projects last Wednesday due to the coronavirus outbreak, including ongoing work to convert Chuquicamata into an underground mine, as well as early projects
in Rajo Inca and Traspaso Andina.

The suspended project is part of a 10-year, $40 billion ongoing plan to upgrade its aging mines and maintain productivity
.
However, the plan could be further jeopardized
by the impact of measures taken in response to the global pandemic crisis.

Mariano Pablo Machado, senior analyst for the Americas at global risk consultancy Verisk Maplecroft, said: "While the government has taken aggressive steps to curb the economic and health impacts of COVID-19, the knock-on effects of the copper supply shock remain to be seen
.
”

Codelco operates seven mines and four smelters
in Chile.
Its assets account for 10% of the world's known proven and probable reserves and about 7%
of annual global copper production.