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Chile Mining Report Q2 2015


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Chile Mining Report Q2 2015

BMI View: Chile's mining sector will see modest average annual growth of 1.6% in 2015-2019. Thecountry's stable political and business environments, combined with its significant mineral reserves, willencourage continued investment. Nevertheless, older mines will still face lagging productivity, whilesubdued copper and precious metal prices will limit sector growth and miners' expansion plans.

The Chilean mining sector will be dominated by copper production for the foreseeable future. In 2014, themetal accounted for approximately 92% of mining exports as measured in dollar terms and nearly 55% ofthe country's total exports. However, the latter represents a decline from 2010, when copper accounted forslightly over 58% of the country's total exports. Ultimately, we expect the mining industry to be hit bylower copper prices, which we forecast will see only a modest recovery in the years ahead. For 2015, weforecast prices will average USD5,750/tonne. Still, the pipeline of copper projects and the country's globaldominance in copper production will ensure the country maintains its lead despite falling ore grades andlagging productivity. Moreover, lower oil prices and a weaker Chilean peso on the back of US dollarstrength will cap growth in input costs, providing a boon to miners facing subdued metal prices.


BMI Industry View
Further Investment, But Only Modest Sector Growth
SWOT
Industry Forecast
Copper: Holding Its Place, But Slowing Growth Ahead
Global Majors To Stay On Top
Costs To Remain Elevated, But Strong Dollar To Provide Relief
Table: Chile - Major Copper Investment Projects
Table: Copper Production Forecast (Chile 2011-2019)
Silver: Slowing Growth In Years Ahead
Silver Deposits To See Further Development
Table: Chile - Key Silver Mine Projects
Table: Silver Production (Chile 2011-2019)
Gold: Subdued Prices To Limit Production Prospects
Copper To Dominate Chilean Mining
Table: Chile - Major Gold Projects
Risks Lie To Downside
Table: Gold Production Forecast (Chile 2011-2019)
Industry Risk Reward Ratings
Chile Risk/Reward Index
Rewards
Industry Rewards
Country Rewards
Risks
Industry Risks
Country Risks
Table: Chile - Mining Forecasts (2011-2019)
Americas Risk Reward Index
Regional Risks Increase Modestly
Weak Prices To Hurt, While Stronger Dollar A Mixed Blessing
Regional Outlook Unchanged Despite Some Reordering
Table: Americas - Mining Risk/Reward Index
Regulatory Development
Potential Regulatory Changes On Horizon
Tax Regime
Corruption To Stay Low
Table: Chile - Political Overview
Table: Regional Regulatory Index
Commodities Forecast
Commodity Strategy
Ferrous Metals
Iron Ore: Further Price Declines
Steel: Weak Iron Ore Prices Will Drag On Steel Prices
Non-Ferrous Metals
Aluminium: Supply Growth To Mute Price Gains
Copper: Only Modest Multi-Year Recovery
Lead: Prices Weakness To Subdue Production Growth
Nickel: Short-Term Weakness To Abate Over Coming Quarters
Tin: Export Curbs Will Eventually Bite
Zinc: Outperformance Set For 2015
Table: Select Commodities - Performance & BMI Forecasts
Competitive Landscape
Codelco To Remain Top Player
Table: Chile - Financial Data For Domestically Listed Mining Firms
Company Profile
Antofagasta
Latest Results
Table: Antofagasta - Supply Chain Analysis
Table: Antofagasta - Financial Data
Codelco
Latest Results
Table: Codelco - Supply Chain Analysis
Table: Codelco - Financial Data
Global Company Strategy - Anglo American - Q2 2015
Company Strategy
Latest Results
Table: Anglo American - Financial Data
Regional Overview
Three Key Themes For Americas Mining
Regulatory Changes On Horizon
Dollar Strength To Be Mixed Blessing
Region To Grow More Dominant As Top Copper Source
Global Industry Overview
Global Overview
2. Stronger US Dollar To Persist
3. Iron Ore Market To Consolidate
5. Standouts In 2015
Methodology
Industry Forecast Methodology
Sources
Risk/Reward Index Methodology
Table: Weighting Of Indicators

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