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Copper Industry April Update (Part 2 of 10) (Continued from Part 1) Copper prices
In the first part of our series, we looked briefly at the Wall Street performance of copper companies. Copper prices are a key driver for copper producers including Southern Copper (SCCO) and Anglo American (AAUKY).
Freeport-McMoRan (FCX) expects its EBITDA (earnings before interest, taxes, depreciation, and amortization) to fall by $500 million for every $0.10 per pound decline in copper prices. The reverse is true when copper prices go up.
Freeport currently forms 3.41% of the iShares U.S. Basic Materials ETF (IYM) and 3.11% of the Materials Select Sector SPDR ETF (XLB). Newmont Mining (NEM) forms 1.91% of XLB.
Copper prices steady
The previous chart shows the movement in copper prices on the LME (London Metal Exchange). Copper prices have traded largely sideways in April. Copper prices fell sharply in January but have recovered smartly since then. Year-to-date, copper prices are down ~4%, and aluminum prices have dropped 3% over this period.
Supply disruptions
There have been supply-side disruptions, including incessant rains and floods in Chile, the world’s largest copper miner. Chile also has the highest reserves of copper, followed by Peru. The Chilean copper association has reduced its production targets for 2015 as a result of weather disruptions.
There have also been mining operation disruptions in Indonesia. The country imposed a ban on exports of unprocessed ores. Indonesian bauxite and copper exports have been negatively impacted as a result. If this weren’t enough, workers blockaded PT Freeport’s Grasberg Mine in Indonesia.
Investors in copper companies should closely track copper production figures. In the next part of our series, we’ll discuss the latest copper production trends.
Continue to Part 3 Browse this series on Market Realist:
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VanEck Vectors Global Alternative Energy ETF
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PRODUCER |
CODE : FCX |
ISIN : US35671D8570 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Freeport McMoran is a copper and gold producing company based in United states of america. Freeport McMoran produces copper, gold, cobalt, molybdenum and silver in Chile, in Congo Dem. Rep. of, in Indonesia and in Peru, develops copper in Peru, and holds various exploration projects in Chile. Its main assets in production are CANDELARIA, EL ABRA, CHINO - MILL, HENDERSON, MIAMI - ROM LEACH, MORENCI - MILL, OJOS DEL SALADO, MORENCI and MORENCI - ROM LEACH in Chile, GRASBERG, SIERRITA and BAGDAD in Indonesia, TENKE FUNGURUME and TYRONE in Congo Dem. Rep. of and CERRO VERDE in Peru, its main asset in development is SAFFORD in Peru and its main exploration properties are BAGDAD - ROM LEACH and CHINO - ROM LEACH in Peru and CERRO VERDE - MILL, CERRO VERDE - CRUSHED LEACH, CERRO VERDE - ROM LEACH, EL ABRA - ROM LEACH and CLIMAX in Chile. Freeport McMoran is listed in Germany and in United States of America. Its market capitalisation is 2.1 billions as of today (€ 1.9 billions). Its stock quote reached its lowest recent point on March 06, 2020 at 10.00, and its highest recent level on September 18, 2024 at 43.92. Freeport McMoran has 47 442 200 shares outstanding. |