Copper price up as miners report sliding production

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“We’ve seen several reports this week from some of the major miners that they are struggling with diesel costs, steel costs, input costs in general, making it much more of a challenge to maintain production,” said Ole Hansen, head of the commodity strategy at Saxo Bank in Copenhagen.

“If anything, we need an increase in production over the coming years to fulfil some of the aspirations we have regarding the climate and Russian dependency.”

Technical signals were also positive as LME copper found support at the 50-day moving average, Hansen added.

Antofagasta on Thursday posted a 24% tumble in first-quarter copper production while Anglo American reported a 13% drop. 

A day earlier Peru said it would declare a state of emergency near Southern Copper Corp’s Cuajone mine in the face of growing protests against mining companies that have halted 20% of national copper output.

Metals have cooled after rallying at the start of the year following Russia’s invasion of Ukraine, which triggered concerns about disruption to supply from the commodity-exporting heavyweight. Traders have priced in lower demand from China, though the outlook remains uncertain.

Copper inventories extended their recovery Thursday after slumping to the lowest since 2005 in March.

(With files from Reuters and Bloomberg)