Global producer MMG reported production expansion for zinc by 6pc from the year prior while copper, lead and molybdenum fell by 31pc, 9pc and 3pc, respectively, in the quarter ending June.
Steep decline in mined metal was for copper segment at 58,729mt, down 31pc from the prior year and 20pc from the prior quarter. Copper cathode production was up 11pc at 18,298mt but declined marginally by 1 pc from the prior quarter.
Lead metal production dipped 9pc to 10,686mt from the year prior but rose 8pc from the prior year quarter. Molybdenum production fell by 3pc from the prior year to 548mt and rose a whooping 341pc from the prior quarter.
| Production (mt) | Q2 2020 | YoY Change | QoQ Change | YTD | YTD Change |
| Copper metal | 58,729 | -31% | -20% | 132,434 | -29% |
| Copper cathode | 18,298 | 11pc | -1% | 36,505 | 26pc |
| Zinc metal | 60,114 | 6% | 14% | 113,071 | -1% |
| Lead metal | 10,689 | -9% | 8% | 20,633 | -9% |
| Molybdenum | 548 | -3% | 341% | 672 | -37% |
Transportation suffered during the COVID-19 lockdowns and no concentrates from Las Bambas was transported in April in line with the Peruvian government health guidelines. It was only in May when concentrate logistics started operating. Improved mining volume at Dugald River resulted in high zinc production compared to prior year offsetting the ongoing impact of lower ore grade.
Disruptions also impacted lead production in South American mines in Peru, Mexico and Bolivia in April and May resulting in concentrate market deficit in Q2 which led to treatment charges falling well below benchmark levels, said the company.
Base metal prices rallied in Q2 due to Chinese economic activities picking up showing signs of COVID-19 recovery. Moves to ease lockdown measures in Europe and the USA provided support to metal prices. Copper was the best performing metal during the quarter, increasing by 25pc.
Outlook
Las Bambas: Mining and production has almost returned to full capacity, the company informed, but uncertainties remain given the COVID-19 infections in Peru where Las Bambas is situated. The company withdrew its production guidance on April 13 due to this.
Dugald River: The company is focused on sustained optimisation of recoveries to offset the impact of lower than originally anticipated zinc ore grades, which are expected to continue over coming periods. Dugald River remains on track to deliver annual mine capacity of 2mn mt and targeted zinc equivalent production to surpass 200,000mt per annum, by 2022. MMG, at this stage, continues to maintain its existing 2020 guidance for Dugald River, with production of between 170,000-180,000mt of zinc in zinc concentrate and C1 costs of $0.70-0.75/lb.
Kinsevere: MMG maintains its existing 2020 guidance for Kinsevere, with copper cathode production of between 68,000 – 75,000mt and C1 costs of $1.80-1.95/lb.
Rosenbery: Production guidance for 2020 guidance remains between 55,000 – 65,000mt of zinc in zinc concentrate and C1 costs of $0.20-0.30/lb.
MMG is headquartered in Melbourne and is a mid-tier global producer of base metals that operates in Australia, Democratic Republic of Congo and Peru.