Freeport-McMoRan said on Tuesday that demand for copper is expected to increase with more data centers being built, and the miner reported a better-than-expected quarterly profit as higher prices of the red metal offset a drop in production.
Average copper prices rose in the third quarter on signs of better demand in top consumer China, falling inventories and as the country unleashed wide-ranging stimulus measures to boost its flagging economy.
Freeport’s quarterly average realized price for copper was up 13.2% to $4.30 per pound, while the metal’s production fell 3.1% to 1.05 billion recoverable pounds in the quarter.
The company said it was seeing robust demand for power cables and building wire associated with electrical infrastructure and data centers in the United States.
“Both the growing sectors more than offset weakness in traditional demand sectors,” CEO Kathleen Quirk said on a post-earnings call.
Last week, Freeport halted copper cathode production at its Manyar smelter in Indonesia after a fire at a sulphuric acid unit at the site in East Java province, which was later extinguished.
Reuters reported last week that Freeport will postpone sales of refined copper from Indonesia until the second quarter of 2025 as the fire caused a further production delay, according to two sources with knowledge of the matter.
The company said on Tuesday that it expects repair costs for the Manyar smelter to be covered by insurance.
On an adjusted basis, Freeport earned 38 cents per share in the third quarter, compared with the average analyst estimate of 35 cents per share, according to data compiled by LSEG.
The company’s shares were up 1.1% at $48.45.
(By Tanay Dhumal and Ernest Scheyder; Editing by Shounak Dasgupta)
Comments