Freeport Expects Higher Copper Output in 2014 - Analyst Blog

By Zacks Equity Research,

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According to Reuters, Freeport McMoRan Copper & Gold ( FCX ) expects its copper output from the Grasberg mine in Indonesia to rise 12% in 2014. As part of the policy to increase the value of exports of raw materials from Indonesia, the mining companies have to process ore before shipping it overseas, effective January.

Indonesia's mining ministry has also come up with a proposal that would allow Freeport's exports of copper concentrate from the Grasberg mine to continue until 2017.

Freeport expects copper production to be 500,000 tons in 2014 compared to roughly 445,000 tons in 2013. Moreover, Gold production is expected to increase by around 47% to about 50-55 tons in 2014 from 37.5 tons in 2013.

The Indonesian mine is the world's second largest copper mine and Indonesia is the world's top exporter of nickel ore, thermal coal and refined tin.

Freeport Indonesia's third-quarter 2013 copper sales were 237 million pounds and gold sales recorded 278,000 ounces, higher than third-quarter 2012 copper sales of 195 million pounds and gold sales of 178,000 ounces, respectively, mainly due to higher ore grades and increased mill rates.

In May 2013, an accident occurred at the Grasberg mine after the collapse of a tunnel at the mine that took 28 lives. Though the accident took place outside the mining operations area, Freeport temporarily suspended mining and processing activities at the Grasberg complex as a part of the rescue and recovery operation.

Freeport, which is among the prominent players in the mining industry along with Newmont Mining Corp. ( NEM ), Barrick Gold Corp. ( ABX ) and Kinross Gold Corp. ( KGC ), is expected to release its fourth-quarter 2013 results on Jan 22.

Freeport currently retains a short-term Zacks Rank #3 (Hold).

BARRICK GOLD CP (ABX): Free Stock Analysis Report

FREEPT MC COP-B (FCX): Free Stock Analysis Report

KINROSS GOLD (KGC): Free Stock Analysis Report

NEWMONT MINING (NEM): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: ABX , FCX , KGC , NEM

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