Optimistic expectations grow for Chilean mining industry in 2024
This is mainly due to the rise in copper prices and external demand, according to the sixth "Mining Signals" index, prepared by Vantaz Group and CESCO.
However, there are still challenges in production and investment, issues that should be addressed from a global perspective to ensure sustainable growth.
Tuesday, June 18, 2024 The sixth edition of the "Mining Signals" index, conducted by Vantaz Group and the Center for Copper and Mining Studies (CESCO), revealed an optimistic outlook for the Chilean mining industry. The study, based on a sample of more than 300 industry representatives, developed between April and May of this year, sought to know the perception of the mining ecosystem on the dimensions that influence the development and growth of the sector.
In general, in this 2024 version, there is an upward trend in expectations for the Chilean mining industry, due to the positive outlook for copper prices and external demand. However, challenges persist in terms of production and investment, central aspects of the sector that must be addressed urgently and with a sustainable perspective.
In this sense, the current optimism is reflected in the overall results of this index, which this year increased 17 points with respect to last year's sample, from 55 in 2023 to 72 in 2024.
It should be noted that a value of 50 in the index corresponds to neutrality; therefore, indexes above this value indicate optimism, and below this value, pessimism. With respect to the index associated with the environment, it continues to be in the pessimistic range, going from a value of 36 in 2023 to 39 this year.
Daniela Desormeaux, Research Director at Vantaz Group, said: "We see an improvement in the outlook, mainly related to the external fundamentals of the copper market, i.e. demand and prices. However, there is still a degree of pessimism regarding the environment, which will improve slightly in the medium term. Nevertheless, production and investment expectations are stagnating and the main concern of the sector is to maintain competitiveness".
Jorge Cantallops, Executive Director of CESCO, noted that "this index is becoming more relevant and robust every year, which allows us to improve the perception of the industry and prepare for different scenarios". Commenting on the more positive results than in previous editions, Cantallops pointed out that "this should undoubtedly lead to a better business and development environment. However, it is still worrying that the perception of the capacity to carry out projects does not follow the same trend. Let's hope that the current policies being implemented in terms of permitting, the lithium strategy and improved market conditions will also improve these indicators," he commented.
It is important to note that in this sixth edition, for the first time, perceptions regarding the development of new projects were asked. In this regard, the results indicate high expectations, with an overall index of 70, suggesting that there could be strong momentum in future investment and production. However, the main concerns focus on the economic and social situation, as well as the regulatory and environmental environment.
On the other hand, mining investment also shows positive signs, with a medium-term index of 72, reflecting confidence in the sustainability and growth of the sector.
Regarding minerals in particular, 57% believe that lithium production will increase in the next two years, while 40% believe that copper production will also increase in the same time frame.
Finally, with respect to demand, 80% believe that copper demand will increase in two years and 63% believe that lithium demand will grow in the same period.
Check the complete 2024 index
