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Strategies & Market Trends : Commodities - The Coming Bull Market -- Ignore unavailable to you. Want to Upgrade?

To: craig crawford who wrote (924)	11/9/2001 2:00:17 PM
From: Stephen O	Read Replies (1) \| Respond to of 1643

Massive moves in base metals today, copper up 2.5c, zinc up 1.3c, lead up 1c. Villarzu of Chile's Codelco on Copper Prices, Demand: Comment 2001-11-09 13:07 (New York) Santiago, Nov. 9 (Bloomberg) -- Juan Villarzu, president of Chile's Codelco, the largest copper producer, comments on the outlook for copper prices and the company's development strategy. Codelco, which accounts for 15 percent of world copper output, said it may make less copper than expected next year by mining ore with a lower content of copper. ``We don't have the least doubt that the situation the copper market is going through today is essentially short-term. The price of copper will return to a normal level once the crisis the world economy is going through is over.'' ``We should expect that the price of copper should recover to what we call a normal long-term level of between 90 cents, or a minimum of about 90 cents, per pound of copper. That's the framework that Codelco and generally all the companies in the industry use to develop their long-term outlook and their strategic vision.'' On the company's plan to consider to mine ore with a lower content of copper, which would trim expected output next year: ``We're revising our mining plans, because in light of recent events we've arrived at a situation with short-term prices that will be less than we had estimated not long ago.'' ``When there is a big difference between the short-term and long-term price, the economic logic suggests that an operational measure that you can take is to save the higher-grade ore for when prices are better.'' Codelco's long-term ``plans of production and business plans won't be altered.'' On worldwide production cuts: ``To ask Codelco or any company to reduce production when it's more efficient that others doesn't make sense.'' ``All of the cuts in production that have been done correspond to high-cost operations. When I say high-cost, in general we're talking about operations with costs that are close to 90 cents or above.'' An exception would be Escondida, the world's biggest copper mine. Escondida plans to reduce output by mining ore with a lower content of copper. On investment plans: ``This is the moment to invest in copper. Copper has a promising future. We're in a situation that clearly is short- term.'' It's the moment ``to take advantage of the opportunities that the market situation gives us now to be able to advance in a business that is key for the country and for us as a company.'' --Heather Walsh in Santiago (562) 638-6820 or hlwalsh@bloomberg.net, or through the New York newsroom (212) 318- 2730/sb