BHP copper investment strengthens South Australian smelting hub

BHP

BHP copper investment at the Olympic Dam complex marks a decisive bet on South Australia as a long-term copper hub. The BHP copper investment totals $555mn and targets higher smelter performance and processing capability ahead of a larger expansion decision due in 2028. As a result, the BHP copper investment positions Olympic Dam to offset declining grades in South America and keep overall group copper output within its strategic range.

BHP copper investment prepares Olympic Dam for future expansion

BHP copper investment will fund several debottlenecking projects rather than one single mega-upgrade. The package includes a new oxygen plant that should raise copper concentrate smelting rates to 85 t/hour from 80 t/hour. It also funds an expansion of the underground electric rail network to 6km from 4.85km, supported by six new locomotives. These incremental changes increase throughput and logistics efficiency while keeping optionality ahead of a delayed multi-billion-dollar smelter and refinery expansion decision. Meanwhile, Olympic Dam acts as the processing backbone for Prominent Hill and Carrapateena, which both feed the centralised smelter and refinery. BHP expects combined South Australian copper production of 310,000-340,000t in the 2025-26 financial year, reinforcing the region’s growing share of group copper output.

Australian copper pivots as South American grades decline

BHP copper investment in South Australia comes as its South American assets face medium-term headwinds. The company has already signalled that copper output from Chile and Brazil will decline over time, with Escondida expected to fall to 900,000-1mn t/yr by 2030. Therefore, strengthening Olympic Dam, Prominent Hill and Carrapateena is essential to stabilise portfolio volume and preserve market share. However, BHP still faces structural challenges around high construction and energy costs for domestic smelting. To mitigate this, it has signed two renewable power purchase agreements with Neoen, which should cover around 70pc of its copper-related electricity needs in South Australia by 2030. These contracts help manage operating costs while supporting decarbonisation commitments. BHP produced a record 2mn t of copper in 2024-25, up 8.1pc year on year, and plans to maintain production within a 1.8mn-2mn t range in 2025-26.

The Metalnomist Commentary

BHP copper investment at Olympic Dam underlines how major miners now use incremental debottlenecking to bridge toward larger capex decisions. By lifting smelter performance and securing renewable power, BHP is quietly repositioning South Australia as a core copper processing hub as Escondida and other South American assets mature. For downstream users, this shift supports more diversified copper supply but will also tie long-term availability to Australia’s energy and project-cost trajectory.

BHP renewable power for copper projects accelerates South Australia’s low-carbon shift

BHP

BHP renewable power for copper projects is moving from strategy to execution in South Australia. The new deals with Neoen link Olympic Dam, Carrapateena and Prominent Hill to dedicated wind and battery assets, reshaping their long-term emissions profile. As a result, BHP renewable power for copper projects is becoming central to the group’s decarbonisation roadmap and its compliance with Australia’s safeguard mechanism.

Wind, storage and safeguard compliance for Olympic Dam

BHP will source 100MW of renewable electricity from Neoen’s 300MW Goyder North wind farm and 200MW Goyder battery. This follows an earlier contract for 70MW from Goyder South, which has supplied Olympic Dam since July. Together, these agreements should cover about 70pc of BHP’s copper-related electricity demand in South Australia by 2030.

Olympic Dam falls under Australia’s safeguard mechanism, where on-site generation counts towards covered scope 1 emissions. In 2023-24, Olympic Dam produced 244,321t of CO₂e, staying just below its 246,875t baseline. Therefore, BHP renewable power for copper projects is not just an ESG narrative but a direct tool for avoiding the surrender of additional ACCUs or safeguard credits.

Meanwhile, BHP still surrendered 47,000 ACCUs across 16 other facilities, including iron ore, coal and nickel operations. This highlights how decarbonisation progress remains uneven across the portfolio. However, the South Australian power strategy shows how dedicated renewable contracts can reduce both compliance risk and long-term power-price exposure.

Copper decarbonisation, diesel displacement and long-term risk

BHP is targeting a 30pc cut in operational greenhouse gas emissions by 2029-30 versus 2019-20 levels. The group has already reduced operational emissions to 8.7mn t CO₂e, a 36pc decline from that baseline. In this context, BHP renewable power for copper projects provides a tangible bridge between climate commitments and actual asset-level performance.

The company ultimately aims for net-zero operational emissions by 2050, mainly by displacing diesel in its mining fleets. Progress here has lagged because of technical delays in low-emission vehicle deployment. However, locking in large-scale renewable power for copper operations buys valuable time while mobile-equipment solutions mature.

For customers and policymakers, BHP renewable power for copper projects offers a clearer line of sight to lower-carbon copper supply. This matters as OEMs, grid operators and EV supply chains increasingly differentiate between standard and low-emission copper units. It also strengthens South Australia’s positioning as a hub for renewable-powered mining and processing.

The Metalnomist Commentary

BHP’s structured shift into contracted wind and storage underscores how decarbonisation is becoming a core competitiveness issue for copper miners. For metals buyers, the next phase will involve translating these renewable power deals into quantifiable, auditable carbon advantages at the cathode, rod and cable level.

BHP record copper output reaches 2mn t as Escondida leads

BHP

BHP record copper output hit 2mn tonnes in FY2024-25, up 8.1pc year on year. The result landed at the top of guidance, underscoring operational resilience. As a result, BHP maintained FY2025-26 guidance at 1.8mn-2mn t. BHP record copper output reflects stronger grades at Escondida and disciplined throughput. Meanwhile, the miner flagged grade normalization ahead.

Escondida drives gains; grades normalize next year

Escondida delivered 1.3mn t, its best in 17 years, lifting group performance. Higher ore grades averaged 1.02pc versus 0.88pc last year. However, grades slipped in April-June and are guided to 0.85pc in FY2025-26. Therefore, BHP plans to offset with higher concentrator throughput and stable maintenance. The company kept Escondida’s 1.2mn-1.3mn t guidance unchanged.

Pampa Norte produced 268,000t, at the top of its range, led by Spence cathodes. Spence cathode output rose 12pc to 117,000t on higher stacked feed grades. However, weaker concentrator feed grades will trim 2025-26 guidance to 230,000-250,000t. The Cerro Colorado site remains in care and maintenance, limiting upside.

Regional performance and outlook for FY2025-26

Copper South Australia produced 315,900t, clipped by an October power outage. Even so, second-half output rebounded 18pc to 171,200t on improved recoveries. The operation set a quarterly record of 92,100t in April-June. Guidance stands at 310,000-340,000t for FY2025-26.

Antamina contributed 119,000t, down 17pc on planned lower grades and throughput. BHP guided Antamina to 120,000-140,000t next year as grades stabilize. The Carajás complex added 9,400t, providing optionality across Brazil. Altogether, BHP record copper output strengthens global supply during tight markets.

The Metalnomist Commentary

BHP’s mix of grade management and throughput discipline stood out this year. Watch Escondida’s grade drift and Spence’s concentrator feed as key swing factors. If guidance holds, sustained capex and steady recoveries should anchor margins despite volatility.

BHP Domestic Copper Investment Shifts Focus Back to Australia

BHP

BHP domestic copper investment will rise as the company pivots to Australia. BHP domestic copper investment offsets medium-term grade declines in Chile and Brazil. Therefore, BHP domestic copper investment targets new smelting capacity and mine upgrades in South Australia. Pampa Norte output will ease to 235,000 t/yr in the medium term. Escondida will trend toward 900,000–1,000,000 t/yr by 2030. Management is also evaluating debottlenecking and sulphide leaching options.

Australian smelting plans advance while South American grades fall

BHP plans a two-phase South Australian investment program. The first phase would lift smelting to 1.1–1.4mn t/yr of concentrate. An investment decision is now slated for 2028. The plan includes expansions at Olympic Dam and Carrapateena. However, Australian energy and construction costs remain challenging. Even so, domestic smelting would improve supply security and value capture.

Chilean portfolio resets with debottlenecking and leaching options

Pampa Norte guidance falls from 268,000 t in FY24–25. It sits at the low end of 230,000–250,000 t for FY25–26. BHP is assessing concentrator debottlenecking for a 2027 decision. It may restart Cerro Colorado using sulphide leaching. Meanwhile, Escondida declines with lower feed grades. Output moves to 900,000–1,000,000 t/yr to 2030. Regional peers also flag cost pressures on processing.

The Metalnomist Commentary

BHP’s pivot hedges grade risk with domestic integration, but cost inflation is real. Watch the 2028 smelter decision, leaching pilots at Cerro Colorado, and debottlenecking returns at Pampa Norte.

BHP Reports Higher Copper Output in July-December, Driven by Strong Escondida Production

BHP

Escondida’s Growth Offsets Declines in Other Operations

BHP, one of the world’s largest mining companies, reported a 10% increase in copper production for July-December 2024, reaching 987,000 tonnes. This growth was primarily driven by higher output from the Escondida mine in Chile, which hit a 10-year high. The strong Escondida performance offset declining production from Pampa Norte, South Australia, and the Antamina mine in Peru.

The company maintained its 2024-25 copper production guidance at 1.85 million-2.05 million tonnes, reinforcing its position as a key player in the global copper market.

Regional Copper Production Performance

Production at Escondida surged 22% year-on-year to 644,000 tonnes, benefiting from higher-grade ore feed and improved recovery rates. Output guidance for 2024-25 remains at 1.18 million-1.3 million tonnes, highlighting continued operational stability.

Conversely, Pampa Norte’s copper production declined by 9% to 126,000 tonnes, mainly due to the temporary care and maintenance of the Cerro Colorado mine. Meanwhile, Spence mine output fell slightly by 1%, but its production guidance remains between 240,000-270,000 tonnes.

In South Australia, copper production dropped by 6% to 145,000 tonnes due to a power outage in October caused by a severe lightning storm. However, operations rebounded, producing 30,000 tonnes in December. Consequently, BHP lowered its South Australian 2024-25 guidance from 310,000-340,000 tonnes to 300,000-325,000 tonnes.

The Antamina mine in Peru saw a 7% drop in production, totaling 67,000 tonnes, due to planned lower throughput and declining ore grades. Despite this, output guidance remains unchanged at 115,000-135,000 tonnes.

Copper Prices and Nickel Market Challenges

BHP’s average realised copper price increased by 9% to $3.99/lb, closely following the London Metal Exchange (LME) price surge of 12% to an average of $9,331/t for July-December.

Meanwhile, nickel prices fell, impacting BHP’s earnings. The company’s average realised nickel price dropped 12% to $16,386/t, aligning with the LME’s 14% drop in class 1 nickel prices to $16,401/t.

Nickel production plummeted 31% to 28,000 tonnes, as BHP suspended operations at its Western Australian nickel division in October. Given the uncertain market conditions, no production guidance has been issued for nickel in 2024-25.

Cost Guidance Updates and Future Outlook

BHP maintained its unit cost guidance at $1.30-$1.60/lb at Escondida and $2-$2.30/lb at Spence. However, due to increased costs in South Australia, the company revised its cost guidance there to the upper half of $1.30-$1.80/lb.

Despite operational challenges in South Australia and Pampa Norte, strong copper prices and Escondida’s production boost have positioned BHP for a resilient 2024-25 fiscal year. With global copper demand rising, the company remains a key player in supplying critical metals for the energy transition.

BHP Foresees Copper Surplus in 2024, But Long-Term Deficits Loom

Australian mining giant BHP has projected a moderate surplus in the copper market for the remainder of 2024, driven by softer demand from China and increased supply. However, the company warns that the red metal could experience significant price increases in the medium to long term as supply deficits emerge due to growing demand.

Short-Term Surplus Expectations

BHP, in its 2024 fiscal results, has adjusted its outlook for the copper market, now anticipating a marginal surplus for the calendar year. This shift is attributed to reduced demand expectations from China, coupled with higher copper supply levels. Earlier this year, the copper market experienced a price surge, with the London Metal Exchange's official three-month copper price reaching an all-time high of $10,927.50 per ton in May. This spike was fueled by reduced production from key South American and Panamanian mines, expected smelter cuts in China, a ban on Russian metal deliveries, and speculation of a US Federal Reserve interest rate cut.

However, the market corrected over the past three months, as it became clear that Fed rate cuts were unlikely before September, and China's economic slowdown—particularly in the real estate sector—further dampened demand. BHP now expects this softer Chinese demand to persist through the end of 2024, limiting the potential for significant increases in LME copper prices in the near term.

Long-Term Copper Deficits

Despite the near-term surplus, BHP remains optimistic about copper's long-term prospects. The company anticipates that demand from traditional sectors, combined with emerging needs from industries such as artificial intelligence and the global shift towards decarbonization, will eventually outstrip supply, leading to market deficits. These deficits could result in price surges, which in turn may incentivize the development of higher-cost supply sources in the future.

BHP's Growth and Expansion Plans

In response to the anticipated future demand, BHP plans to increase its copper production by 4% in the 2025 financial year, focusing on mining higher-grade ores at its Escondida mine in Chile and improving productivity across all assets. The company also highlighted several growth opportunities, including four major expansions across existing and new facilities in Chile, with final investment decisions expected between 2026 and 2029.

Additionally, BHP is evaluating the potential to boost its Copper South Australia production from 322,000 tons in fiscal 2024 to 500,000 tons annually by the early 2030s, and further to 650,000 tons annually by the mid-2030s. The company also holds a 45% stake in the Resolution project in the United States, one of the world's largest undeveloped copper projects, which could play a significant role in meeting future copper demand.

Codelco Teams Up with Rio Tinto and BHP to Boost Chile Copper Exploration

Codelco

Strategic Copper Partnerships Target Atacama and Antofagasta Regions

Codelco has partnered with Rio Tinto and BHP to expand copper exploration in Chile, strengthening its role in the global copper supply chain. These two separate strategic deals target the Atacama and Antofagasta regions — two of the world’s most copper-rich zones — and reflect increasing investment in high-potential, underexplored areas.

Codelco and Rio Tinto formed a joint venture to explore the Nuevo Cobre region in the Atacama Desert, where Rio Tinto holds a 57.7% stake and Codelco 42.2%. The collaboration focuses on mineral extraction around the Potrerillos smelter and San Antonio property. Over the next 12 months, both parties will co-finance technical studies and business plans, with an option to extend the partnership timeline.

BHP Commits $40 Million to Study Codelco Sites

In a separate agreement, Codelco granted exclusive exploration rights to BHP for 34 properties in the Antofagasta region, including the early-stage Anillo project, which spans over 59,000 acres. BHP will invest up to $40 million to assess the copper potential of these sites.

If BHP deems the project commercially viable, it will partner with Codelco to move forward with development. Otherwise, all research and data generated during the study period will revert to Codelco. This structure enables Codelco to retain strategic optionality while leveraging private-sector exploration capital.

Chile Reinforces Global Copper Leadership Through Collaboration

These agreements signal a new era of public-private collaboration in Chile’s mining sector, with Codelco leveraging global mining majors to accelerate exploration. The deals also highlight the growing urgency to secure future copper supply amid rising demand from clean energy infrastructure and electric vehicles.

As the world’s largest copper producer, Chile remains critical to global decarbonization goals. These joint efforts aim to unlock new deposits and ensure a stable, diversified copper pipeline for the decade ahead.

The Metalnomist Commentary

Codelco’s dual alliances with Rio Tinto and BHP represent a strategic blueprint for unlocking untapped copper resources while sharing risk. With global copper supply tightening, such partnerships are essential to ensuring long-term mineral security — especially in geopolitically stable, resource-rich countries like Chile.

BHP Commits $25 Million to Cobre’s Copper Projects in Botswana

BHP

Earn-in agreement targets 75% stake in Kitlanya East and West, strengthening exploration in the Kalahari Copper Belt.

Cobre, an exploration company, has signed an earn-in agreement with BHP, one of the world’s largest mining firms, to advance copper exploration in Botswana. Under the deal, BHP will invest up to $25 million in exploration work at Kitlanya East and Kitlanya West, both located within the Kalahari Copper Belt.

The belt stretches over 1,000 km across Botswana and Namibia and is increasingly recognized for its high-grade sediment-hosted copper potential.

BHP Targets Majority Stake Through Staged Investment

The agreement allows BHP to earn a 75% stake in the two Kitlanya projects by funding exploration activities. The company will begin with an initial $5 million over two years, followed by a planned $7 million program starting in April. The investment marks a strategic move by BHP to secure critical copper resources as global demand surges.

Meanwhile, Cobre will retain full control of its other copper assets in Botswana, specifically the Ngami and Okavango projects, which it plans to develop independently.

This partnership further underscores the Kalahari Copper Belt’s importance as a key exploration frontier for copper supply diversification.

BHP to Temporarily Suspend Nickel Operations in Australia

BHP, a leading Australian resources firm, announced today its decision to temporarily suspend operations at its Western Australia nickel businesses starting October, with a review planned for February 2027. This suspension affects the Kwinana nickel refinery, Kalgoorlie nickel smelter, and the Mt Keith and Leinster mines. Additionally, the development of the West Musgrave project will be paused. A care and maintenance program will be implemented to ensure the mines' and infrastructure's safety and integrity during this period.

The decision comes amid an oversupply in the global nickel market, which has led to significant price drops. Benchmark prices for class 1 nickel on the London Metal Exchange have plummeted by approximately 20% over the past year, reaching $16,737 per ton on July 10, down from over $20,000 per ton in early July 2023.

"Like others in the Australian nickel sector, we have not been able to overcome the substantial economic challenges driven by a global oversupply of nickel," stated BHP President Geraldine Slattery.

This suspension raises concerns about the impact on the company's workforce and local communities. In response, BHP has committed to a A$20 million ($13.5 million) community fund to support local communities. The company will offer its frontline workers alternative roles within BHP or redundancy options. The Western Australia Labour government has introduced measures to assist affected workers, including training, upskilling, and job matching.

Following the transition period, BHP plans to invest around $300 million annually to support a potential restart of the facilities. This investment will focus on exploration to extend the resource life and preserve operational flexibility. The transition will begin in July, with operations ceasing in October and halting completely by December.

In February, BHP announced a review of its nickel operations and reported a non-cash impairment charge of $3.5 billion pre-tax on its Western Australia nickel business. With the temporary suspension, an additional $300 million pre-tax non-cash impairment charge will be sustained.

BHP exits Kabanga nickel project as Lifezone assumes full control

BHP

BHP exits Kabanga nickel project, selling its 17% stake to Lifezone Metals for up to $83mn. The transfer gives Lifezone 100% of Kabanga Nickel Ltd and full offtake rights. The move reflects BHP’s broader nickel retrenchment during a prolonged market slump.

Deal terms and strategic reset

Lifezone now owns KNL, which holds 84% of Tembo Nickel in Tanzania. The Tanzanian government retains a 16% stake in Tembo Nickel. Lifezone targets a 2026 final investment decision on the $2.49bn complex. The design pairs a mine with a hydrometallurgical refinery for battery-grade material. Nameplate output targets 50,000 t/yr of nickel in concentrate after ramp-up.

Project outlook and market headwinds

Nickel prices remain under pressure from Indonesian surpluses and softer demand. LME cash prices have fallen over 40% since early 2023. Economics across new projects have therefore tightened materially. BHP earlier placed Nickel West on care and maintenance. It plans a decision on that asset’s future by early 2027. Against this backdrop, BHP exits Kabanga nickel project to sharpen portfolio focus.

Lifezone frames Kabanga as a premier undeveloped sulphide deposit. Hydromet refining could deliver cleaner, higher-quality battery feed. The project aims to support EV supply chains with secure, traceable nickel. However, six years to full ramp leaves execution risk. Financing, power, and permitting will be decisive for timelines.

The Metalnomist Commentary

This handover trades super-major capital for specialist focus. If Lifezone proves its hydromet route at scale, Kabanga could reset African nickel. Yet market discipline and offtake financing must align before shovels truly matter.

CATL BHP mining electrification accelerates heavy equipment and rail decarbonization

BHP mining

CATL BHP mining electrification advances with a new strategic collaboration. The non-binding pact targets batteries for haul trucks and locomotives. CATL BHP mining electrification also covers fast-charging, energy storage, and recycling. The partners aim to build a repeatable model for low-carbon mining.

Scope, technology, and capacity roadmap

The collaboration focuses on electrifying mining fleets and rail while installing fast-charge networks. CATL BHP mining electrification benefits from CATL’s projected 700–1,000 GWh capacity in 2025. CATL expands globally and builds a 40 GWh plant in Dongying. Therefore, supply depth supports prototypes, pilots, and scaled deployments.

Market drivers and North American relevance

Demand for critical minerals and storage is rising with renewables and AI data centers. China’s new-energy truck sales hit about 72,000 in January–June 2025. As a result, battery heavy-duty platforms are maturing quickly. Meanwhile, BHP targets net-zero operational emissions by 2050, reinforcing adoption timelines.

The Metalnomist Commentary

This tie-up links OEM battery scale with miner operating know-how. Success hinges on duty-cycle validation, pit-side charging buildout, and grid access. Watch TCO versus diesel, battery lifecycles, and recycling value recovery.

Workers at Key Escondida Copper Mine Vote for Strike

Workers at BHP's Escondida copper mine in Chile have voted overwhelmingly in favor of a strike, following the company's failure to reach a new contract agreement with their union. The Sindicato de Trabajadores de Minera Escondida union, representing 2,377 workers, announced that 99.7% of its members supported the strike action. The union is now anticipating a resumption of negotiations with BHP.

The Escondida mine, the world's largest producer of copper concentrates and cathodes, is a critical asset for BHP. Should negotiations fail to yield an agreement by August 6, the union plans to initiate the strike on that date, according to sources speaking to Metalnomist.

The workers are demanding that at least 1% of the company's dividends be distributed equally among them. In response, BHP stated it would seek mediation with Chile's labor authority "in the coming days," while maintaining that the mine continues to operate "normally."

BHP holds a 57.5% stake in the mine, with the remaining shares controlled by Rio Tinto and Japan-based JECO. For the fiscal year ending June 30, the Escondida mine produced 1.125 million metric tonnes of copper, a 7% increase from the previous year. BHP has projected copper production of 1.18 to 1.3 million tonnes for the year ending June 30, 2025, driven by higher grades and throughput.

BHP to Supply Sulphuric Acid to Lynas Rare Earths Amid Nickel Suspension

Australian resources giant BHP has reaffirmed its commitment to providing sulphuric acid to Lynas Rare Earths, an Australian-listed mining company. This announcement follows BHP's decision to temporarily suspend its Western Australia nickel operations, citing lower-than-expected nickel prices.

Strategic Supply Agreement

Lynas has a supply agreement with BHP's Nickel West to receive sulphuric acid from the Kalgoorlie nickel smelter or other imported sources. This contract, which began today, is set to run until June 30, 2027. The supply of sulphuric acid is crucial for Lynas' rare earths processing facility in Kalgoorlie.

Economic Implications

BHP's commitment ensures a steady supply of a critical input for Lynas, despite the nickel business suspension. This move highlights the interconnected nature of mining operations and the importance of maintaining supply chains amid market fluctuations.

BHP Moves Forward with Olympic Dam Smelter Expansion in Australia

BHP

Company Begins Application Process for Significant Copper Production Boost

On August 30, Australian mining giant BHP announced the initiation of an application and assessment process for its planned expansion of the Olympic Dam smelter and refinery in South Australia. This expansion aims to enhance copper production capabilities at the site, which currently processes copper concentrate from the Olympic Dam, Prominent Hill, and Carrapateena mines. In the fiscal year ending June 30, the South Australian operations achieved a record cathode production of 215,700 tons.

BHP is set to make a final investment decision on the first phase of the expansion by mid-2027. The company plans to increase its copper output by 4% in the 2025 financial year through higher-grade ores at its Escondida mine in Chile and overall asset productivity improvements. Future growth prospects include significant expansions across Chilean facilities, with investment decisions expected between 2026 and 2029. BHP also targets increasing South Australian copper production to 500,000 tons annually by the early 2030s and 650,000 tons by the mid-2030s.

Copper Demand to Surge by 2.6% Annually Through 2035: BHP

BHP : Copper

BHP, the Australian mining giant, has projected that global copper demand will experience a significant increase, growing by 1 million tonnes per year until 2035. This rise is fueled by the ongoing global energy transition and the rapid expansion of the digital sector, according to a report released on Monday.

Over the past 75 years, copper demand has grown by 3.1% annually, but growth slowed to 1.9% in the 15 years leading up to 2021. However, BHP anticipates that the annual growth rate will rebound to 2.6% by 2035, driven by rising living standards and continued demand from developed economies. The report further highlighted that global copper demand is expected to grow by around 70% by 2050, reaching more than 50 million tonnes annually, an average growth rate of 2% per year.

The Role of Energy and Recycling in Future Copper Demand

A key factor in the rise of copper demand is the energy transition, which is projected to account for 23% of global copper consumption by 2050, a significant increase from the current 7%. The digital sector's share of copper usage is also expected to rise, from 1% today to 6% by mid-century.

In response to this increasing demand, recycled copper will play a pivotal role, with scrap copper supply expected to rise from approximately one-third of total copper consumption today to 40% by 2035. By 2050, recycled copper could constitute up to half of global copper usage, a vital component in bridging the supply gap.

However, challenges remain. BHP has identified the rising costs of production and declining ore grades—down 40% since 1991—as significant concerns for future copper supply. To meet the growing demand, the world will need an additional 10 million tonnes of newly mined copper annually over the next decade.

Chile copper output up 1H 2025 on Codelco, BHP gains

BHP

Chile copper output up 1H 2025 as state and private miners lift production. Chile copper output up 1H 2025 reached 2.65mn t on stronger grades and throughput. As a result, Chile copper output up 1H 2025 underscores the country’s stabilizing mine performance.

Production leaders and laggards

Codelco led growth with a 9.6pc increase to 688,700t in January–June. Chuquicamata, Radomiro Tomic and Ministro Hales rose 12.6pc to 321,400t. El Teniente advanced 15.8pc to 172,000t on steady operations. However, Andina fell 10.6pc and Gaby dropped 24.3pc. These offsets tempered, but did not derail, national gains.

BHP’s Escondida strengthened output by 10.7pc to 680,100t. Higher ore grades supported the improvement despite cost pressures. Meanwhile, Collahuasi declined by a third to 189,500t on lower-grade stock processing. Los Pelambres slid 8pc to 148,700t, and Anglo American Sur fell 15.9pc to 102,300t.

Outlook and market implications

Chile’s first-half total rose 2.6pc to 2.65mn t, signaling gradual recovery. Therefore, supply risks eased even as some assets faced grade challenges. Stronger Codelco and Escondida volumes stabilize concentrate flows and cathode supply. However, weaker Collahuasi and Los Pelambres highlight persistent variability.

Traders should watch grade trends and maintenance schedules through the second half. As a result, TC/RC dynamics and premiums may stay rangebound. Smelters could see steadier feed, while OEMs gain planning visibility. Yet, regional weather, labor, and permitting remain key swing factors.

The Metalnomist Commentary

Chile’s diversified asset base is cushioning grade headwinds. If Codelco sustains El Teniente and Chuquicamata gains, 2025 guidance looks safer. Watch Collahuasi’s ore blend and Escondida’s grade profile for second-half direction.

BHP and Lundin Mining Partner on Argentinian Copper Projects

BHP and Canada-based Lundin Mining have entered into a definitive agreement to acquire mining company Filo and jointly develop the Josemaria copper project in Argentina. The agreement involves forming a 50/50 joint venture to manage the Filo del Sol (FDS) and Josemaria copper projects in San Juan province. The FDS deposit is an advanced-stage copper exploration project, while Josemaria, already controlled by Lundin, is also at an advanced development stage and situated nearby.

Both companies are optimistic about the potential of this partnership. Lundin Mining’s CEO, Jack Lundin, emphasized the significance of FDS, describing it as "one of the world's largest undeveloped copper-gold-silver deposits." The joint venture aims to "develop an emerging copper district with world-class potential that could support a globally ranked mining complex," according to Lundin.

Argentina has emerged as a promising copper-rich region, and companies are rushing to secure a stake in the region. Both companies are "excited about their role in developing the region," as they partner to acquire FDS. The acquisition, valued at C$4.1 billion (approximately $2.96 billion), involves Lundin contributing $1.5 billion towards the purchase. Additionally, BHP will pay $690 million in cash to Lundin for the Josemaria stake in the joint venture.

This deal, however, is still subject to approval by the court under Canadian law and requires the endorsement of Filo’s shareholders. Once completed, this venture will position BHP and Lundin as significant players in the global copper market, contributing to the supply chain essential for electric vehicles and renewable energy technologies.

Surge in Copper Production: Codelco and BHP Lead the Way

Codelco

A Closer Look at November's Copper Production Increases

Chile's premier state-run enterprise, Codelco, along with the Australian mining giant BHP's Escondida mine, have reported significant increases in their copper production for November. This development could signal a robust period for the metal's market moving forward.

Significant Gains Amidst Global Challenges

In a detailed report from the Chilean copper commission Cochilco, it is noted that Codelco's production for November reached 133,600 tons. This figure represents a remarkable 17% increase compared to the same period in 2023, marking the highest output observed last year. Despite facing production challenges earlier in the year, Codelco has evidently managed a vigorous recovery in the latter half.

On the other hand, BHP's Escondida mine, the largest copper mine in the world, produced 108,200 tons of copper in November alone, up by 28% from the previous year. This substantial growth underscores Escondida's critical role in the global copper market.

Variance Among Competitors

While Codelco and BHP have enjoyed production boosts, not all industry players saw the same success. The Collahuasi mine, which is a joint venture between Anglo American, Glencore, and Japan's Collahuasi Resources, experienced a downturn. The mine's output declined by nearly 24% year-on-year, totaling only 36,700 tons in November.

Despite these mixed results, the overall copper production in Chile from January to November stood at approximately 4.94 million tons, marking a 3.9% increase over the previous year. This growth is largely attributed to the strong performances of both Escondida and Codelco during the latter half of the year.

Mitsui and Itochu Australian iron ore investment strengthens Asian steel supply chains

Australian Iron Ore

The Mitsui and Itochu Australian iron ore investment strengthens long term raw material security for Asian steelmakers. The two Japanese trading houses will acquire a combined 15% stake in the Ministers North iron ore projects from BHP in Western Australia. As a result, they will secure offtake rights from an expected 20mn t/yr operation, pending a final investment decision by June 2026.

This Mitsui and Itochu Australian iron ore investment also deepens long standing partnerships with BHP in the Pilbara. Itochu will hold an 8% stake and targets 1.6mn t/yr of iron ore, mainly for Chinese customers. Mitsui will take a 7% stake and aims to offtake about 1.4mn t/yr, supplying Japan and other Asian markets. Therefore, each firm will align offtake volumes with its equity share, reinforcing stable contractual flows rather than spot exposure.

Ministers North steps in as Yandi successor

The Ministers North project will effectively replace the aging Yandi mine jointly operated by BHP, Mitsui and Itochu. Yandi is scheduled for a gradual production decline and eventual closure, although the final shutdown date remains undisclosed. Therefore, Ministers North functions as a crucial continuity asset, preserving existing rail, port and blending synergies in Western Australia.

Project timing remains tied to a final investment decision scheduled by June 2026. Commercial operations could then ramp up to the envisaged 20mn t/yr run rate. However, the consortium must still navigate cost inflation, permitting timelines and infrastructure coordination with other Pilbara projects. If delivered on schedule, Ministers North will smooth the transition from Yandi without a major gap in supply.

Broader Pilbara strategy behind Mitsui and Itochu Australian iron ore investment

The Mitsui and Itochu Australian iron ore investment also sits within a wider Pilbara growth strategy. Mitsui separately announced a $5.3bn commitment in February to acquire a 40% share in the Rhodes Ridge joint venture. The company aims to start commercial operations there by around 2030, although the final investment decision schedule is still under review.

Together, Ministers North and Rhodes Ridge will anchor Mitsui’s long term iron ore portfolio in Western Australia. Meanwhile, Itochu’s additional stake in Ministers North underpins its iron ore flows to China during a period of changing demand patterns. As a result, the Mitsui and Itochu Australian iron ore investment reinforces Japan’s broader goal of diversified, low risk iron ore sourcing across key Asian markets.

The Metalnomist Commentary

This deal shows how Japanese trading houses quietly rebuild long term security in iron ore rather than chase short term price cycles. By backing Ministers North as Yandi’s successor and supporting Rhodes Ridge, Mitsui and Itochu lock in future Pilbara options while steel demand in Asia matures. Market participants should watch how offtake contracts and quality specifications evolve, especially for blends tailored to China and Japan’s decarbonising steel sectors.

Kabanga nickel project secures $60mn loan to advance development

Kabanga Nickel Project

The Kabanga nickel project will receive up to $60mn from Taurus Mining Finance. The Kabanga nickel project drew a first $20mn tranche on 29 August. The Kabanga nickel project aims to accelerate mine development and reach key milestones.

Funding structure and ownership

Lifezone Metals arranged a loan of up to $60mn with Taurus. Additional drawings depend on performance and milestone delivery. The company now owns 100% of Kabanga. BHP sold its prior 17% stake in July for up to $83mn. The facility supports mine construction and early works. It also strengthens working capital for long-lead items.

Revised plan and output profile

Lifezone updated the mine plan in April. The design targets a 3.4mn t/yr underground mine and concentrator. A July feasibility study outlines 902,000t nickel in concentrate over 18 years. The project also expects 134,000t copper and 69,000t cobalt in concentrate. The staged debt supports critical path activities. It also aligns cash flows with ramp-up timing.

Market context and strategic relevance

Global nickel markets face mixed signals. Battery demand grows, yet class-II supply weighs on prices. High-grade sulphide feed remains strategic for battery supply chains. Kabanga’s concentrate mix diversifies regional supply. The financing lowers execution risk. It also positions Lifezone for downstream partnerships.

The Metalnomist Commentary

Milestone-linked funding is prudent in a volatile nickel market. The ownership simplification post-BHP exit may speed decisions and offtake talks. Watch capex discipline and timetable risk as underground development advances.