• Peru: Mining sector investment rises as production expands, with additional capacity coming on stream


Mining investment increased 6.5% y/y in June, according to the Ministry of Mining (chart 1). On a cumulative basis, mining investment increased 10.9% y/y in the first semester.

Chart 1: Peru: Mining Investment

Anglo-American, with its Quellaveco project, continued to lead investment, which increased 10.1% in the cumulative January–June period y/y. Construction of Quellaveco is scheduled to conclude in the second half of the year, although the company has already announced its first output of copper concentrate in July. Investment will continue in H2-2022 until construction is completed and commercial operations begin. We expect the first production in Q3-2022, with full capacity coming onstream in Q4-2022.

The other two companies that led investment were Antamina, with its plan to expand its operations by investing USD 1,600 mn over the next eight years, and Southern Copper, with the expansion of the Quebrada Honda dam and purchase of machinery and equipment. Investment in the Toromocho Expansion construction by Chinalco will conclude in the second half of the year. Investment in exploration increased 50.1% y/y in June, accumulating an increase of 38.4% in the first six months of the year.

Mining production increased in copper (+8.6%), iron (+3.8%), tin (+2.3%) and molybdenum (+9.5%), while fell in gold (-4.1%), zinc (-21.5%), silver (-9.1%) and lead (-2.0%) (table1).

Table 1: Peru-Mining Output

Increased copper output reflects higher ore grades at Antamina (+14.4%) and higher tonnage processed at Cerro Verde concentrator plants (+13.8%) although further clarification of why this occurred was not given. These factors boosted copper output despite a decline at Las Bambas (-34.6%), as operations there were disrupted until June 11, and lower output at Southern (-10.5%), owing to lower ore grades.

Gold output continued to decline (-4.1%) as existing mines are becoming depleted (table 2).

Table 2: Peru-Top 20 Mining Companies by Investment Amount

—Katherine Salazar