When considering the future of copper mining, the world needs 80 new sizable copper mines by 2040. This makes it critical to focus on the structural supply-demand gap and not current geopolitical trade tensions, Anglo American Chile’s chief executive officer said.
“We estimate that we’re going to need 80 mines the size of Los Bronces by 2040, and 2040 is around the corner. Despite the macroeconomic and geopolitical contexts that we are living in, that date is coming,” Patricio Hidalgo told Fastmarkets.
“You can see that there is an industry consensus around that, as well as consensus that copper needs to be better copper; it needs to have the right sustainability standards. So, our investment decisions are made on that basis — on the long-term structural supply-demand gap that we see,” he added.
Los Bronces produced 172,400 tonnes of copper in 2024 — comprising 145,200 tonnes of concentrate and 27,200 tonnes of cathode — down by around 20% year on year from 215,500 tonnes, as one of the processing plants at the site was placed on care and maintenance in mid-2024.
Chile’s copper trade with the US
Speaking during an interview in the annual CESCO industry week in Chile, Hidalgo said that US trade data shows that Chile has a $1.7 billion trade surplus with the US, having exported total goods worth $16.5 billion and imported $18.2 billion of US goods last year. The country is subject to a 10% universal tariff on imports to the US, although copper is currently exempt.
“Chile has been, and will continue to be, a very reliable trade partner to the US — I think the fact there is a trade surplus demonstrates this,” Hidalgo said.
“Chile exports around 10% of the copper to the US, and it’s mostly in the form of refined copper. But the refined copper can take different flows, depending on how the market shifts, and refined copper has terminal markets as well, so I think it has more buffers in that regard,” he added.
Navigating market stress and long-term resilience
He acknowledged that heightened macroeconomic and geopolitical risks plus the global tariffs have nonetheless placed financial markets, including copper, under stress.
“We could potentially see some inflation, which could have knock-on effects, and that is something that we continue to monitor. We set up the business for resilience, but again, we make decisions in the long term,” Hidalgo said.
Anglo American produced 466,000 tonnes of copper in 2024 and expects to produce 380,000-410,000 tonnes in 2025 before seeing production rise again in subsequent years.
Expanding copper production
Copper is one of Anglo American’s three core pillars, with the others being iron ore and crop nutrients. The company has previously said that its objective is to increase its equity share of copper production across its different operations to 1 million tonnes by the early 2030s.
That growth will include production from Chile, where Anglo American is a 50.01% stakeholder in each of the Los Bronces and El Soldado mines. In Chile, it also operates the Chagres smelter and is a 44% shareholder in the Collahuasi mine, along with Glencore and Japan Collahuasi Resources B.V., which have 44% and 12% stakes respectively.
A strategic alliance with Codelco
An alliance between Anglo American and Codelco to implement a joint mine plan at Los Bronces and Andina is expected to be formally signed in the second half of the year, Anglo American Chile’s chief executive officer said.
Patricio Hidalgo told Fastmarkets that negotiations are continuing, and if the country’s permitting process is streamlined, the project will begin sooner than the currently anticipated five years.
“The joint mine plan is expected to start from 2030, and it will run until 2051. The reason it won’t start until five years from now is that’s how long it takes to complete an environmental impact assessment and then for it to be approved,” he said during an interview in the annual CESCO industry week in Santiago, Chile. “If we could streamline the permitting process, the project would start earlier,” he added.
The Chilean government has committed to reduce both environmental as well as sectorial permitting timeline by one third, from an average of around three years for environmental impact assessments and just over a year for sectorial and other permits. This has not yet materialized, but discussions with the different stakeholders are currently ongoing.
Unlocking untapped potential with collaborative mining
A memorandum of understanding for a framework to implement a joint mine plan for Anglo American’s Los Bronces and Codelco’s Andina mines was signed in February. The two mines share a single orebody, which represents more than 2% of the known copper reserves in the world, Hidalgo said.
The goal, he added, is to mine the middle area shared by the two companies, known as the wedge.
“It’s one orebody, but it’s now mined by two different operations and that obviously doesn’t allow you to unlock the full value because the wedge in the middle has the best quality reserves and resources,” he noted.
The joint mine plan will increase copper production with minimal additional capital required, generating an expected net present value (NPV) uplift of at least $5 billion pre-tax over the period of the agreement, to be shared equally.
“With very little capital, if any, we will be able to unlock 2.7 million tonnes of copper that will be delivered from 2030 to 2051, or around 120,000 tonnes of copper per year. This represents a roughly 2.8% increase in annual copper production in Chile versus the baseline in 2023,” Hidalgo told Fastmarkets.
Challenges in implementation
“There is no transfer of property, workforce or concessions. We are fully aligned with the constitutional requirements, so each entity will retain its property — we will each have separate environmental impact studies, but that will enable us to run and optimize it as one,” he said.
This means the additional mill or line to process the material is required, while production, costs and liabilities will be split equally between London-listed Anglo American and Chile’s state-owned producer Codelco, he added.
A new industry approach
“The alliance invites the sector to think differently. When you think about all the adjacencies that exist not only on the Chilean side, but in the Andes and I’m sure elsewhere in the world, and the use of shared infrastructure like diesel plants and pipelines, it’s a really good challenge for the industry to see where it can work together,” Hidalgo said.
A processing plant at Los Bronces was placed on care and maintenance from mid-2024, a temporary decision which, despite a short-term decline in production, has improved costs and financial margins, Hidalgo noted.
“The Los Bronces plant is eventually going to reopen, whether as a standalone and/or with this agreement of joint mine plan with Codelco,” Hidalgo added.
Other projects shaping the industry
The company is already embarking on the Los Bronces Integrated (LIB) project, which comprises open pit phases, water efficiency projects, and an underground mine project.
The company is also working on options to extend the life of its El Soldado copper mine, which is expected to end in 2028. Production in 2025 is expected to return to 2023 production levels of around 40,000 tonnes due to planned lower grades, before declining further to 30,000-35,000 tonnes through to 2028.
“At the moment, we’re running the engineering studies for the different alternatives — we have the resource and research to run for longer, but the real bottleneck we need to solve is the tailings capacity,” Hidalgo told Fastmarkets.
Innovation in mining techniques
One option is the company’s hydraulic dry stacking technology, which it has been testing at an industrial scale since 2022. There could be a material impact on production. Anglo American is also discussing with its peers how it could potentially take the technology to scale industry-wide, Hidalgo said.
It is also waiting on decontamination plan results in an area near to its Chagres copper smelter in Catemu. This could trigger some kind of investment to comply with new environmental regulations, he said.
“At this point in time, it’s too early to say what the outcome will be. We’ve been waiting for the information for a while now. We are still unclear whether the plan will apply to Chagres itself; whether it is a regional view; or whether it is going to be split between different provinces within the same area — and that will have a different outcome for Chagres in terms of investment required,” Hidalgo added.
Chagres has the capacity to produce 500,000 tonnes of copper concentrate annually, with production varying depending on the grade of the feed.
In Hotter Commodities, special correspondent Andrea Hotter covers some of the biggest stories impacting the natural resources sector. Read more coverage on our dedicated Hotter Commodities page here.
