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 Related Quotes
 Caterpillar Inc  343.38   5.38  1.59%
 Freeport-mcmoran Inc  50.50   1.10  2.23%
 Enter Symbols: 

Freeport-McMoRan on Copper Prices: You Ain't Seen Nothing Yet, an Industrial Info News Alert

SUGAR LAND, Texas, Jan. 26 /BusinessWire/ -- Researched by Industrial Info Resources--Growing demand for copper and higher prices for gold are boosting fortunes at Freeport-McMoRan Incorporated (NYSE:FCX) (Phoenix, Arizona), which expects to sell 4.1 billion pounds of copper, 2 million ounces of gold and 85 million pounds of molybdenum in 2024. Those expectations for copper are flat when compared with 2023's results, but exceed last year's sales of gold and molybdenum. Closures and disruptions at various copper mines worldwide have driven prices higher for the metal, which is a necessary component for clean-energy technology and electric-vehicle batteries. Industrial Info is tracking nearly $13 billion worth of active and planned projects from Freeport-McMoRan worldwide, including about $3 billion worth in the U.S.

"There were the supply shortfalls throughout the industry for some significant mines, for a range of factors that are kind of common to our business," said Kathleen Quirk, the president of Freeport-McMoRan, about the strong prices for copper in an earnings-related conference call earlier this week. "As a result, inventories of copper around the world are at historically low levels, and the inventory levels are really inconsistent with the current copper price."

Quirk said the current copper prices are driven by macroeconomic factors, including the strong U.S. dollar, carryover effects from inflations, various government fiscal policies, and worsening economies in China and Europe: "I'll just say, when the macro outlook improves, watch out for the copper price. Looking ahead, the world's going to need significantly more copper in the future for a variety of factors. The world's just becoming increasingly electrified and that's what copper is used for. And it's at a time when the industry is simply not investing to grow production."

Freeport-McMoRan has several growth projects on the books across the U.S., including a major expansion at its Lone Star Mine in Safford, Arizona, which kicked off in the summer of 2022 and now is wrapping up. Freeport aims to increase Lone Star's overall production of copper from 250 million to as much as 300 million pounds per year by expanding the crushing facility and handling-and-stacking system for copper oxide ore. The company is increasing the feed rate on the crushing system from 95,000 to as much as 120,000 tons per day. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project and Plant databases can learn more from Industrial Info's detailed project report and plant profile.

"We have a major opportunity in the U.S. at the Safford Lone Star District," Quirk said in the earnings call. "We've identified a significant resource there. This year, we're going to work to complete metallurgical testing and mine planning, and start a pre-feasibility study to assess future development options there."

Freeport-McMoRan also is seeking permits for a pit addition at its copper mine in Tyrone, New Mexico. Positioned just south of the existing Tyrone Pit, the new Emma Pit would contribute three to five years of copper mineral resources, extending the 146 million-ton-per-year facility's operation life beyond 2027, according to Freeport-McMoRan. The Tyrone complex includes a solvent extraction and electrowinning (SX/EW) facility that produces 82,125 tons per year of copper cathode. Subscribers can learn more from a detailed project report and plant profile.

On the refining side, Freeport-McMoRan expects to begin work on a tankhouse material-handling addition at its copper refinery in El Paso, Texas, which has a 900 million-pound-per-year output, in the near term. In November, Freeport booked a $10.9 million order with Metso Corporation (Helsinki, Finland) for Metso's Outotec anode-preparation and cathode-stripping machines, which use electrode-handling robotics to improve material-handling efficiencies at the refinery. Subscribers can learn more from Industrial Info's detailed project report and plant profile.

Signs of Life for Bagdad Mine Expansion in Arizona

Freeport-McMoRan is moving cautiously on a long-standing proposal to roughly double production capacity at its copper-molybdenum mine in Bagdad, Arizona, to as much as 400 million pounds per year of copper and 22 million pounds per year of molybdenum. The company already is at work on a conversion of the Bagdad Mine's haul trucks to a fully autonomous haulage system, which would utilize technology from Caterpillar Incorporated (NYSE:CAT) (Deerfield, Illinois) to improve safety and decrease operating costs. Subscribers can read detailed project reports on the proposed expansion and ongoing truck conversion, and read a detailed plant profile.

"We completed a feasibility study late in the year 2023, to evaluate a project to more than double the size of our Bagdad operation in Northwest Arizona," Quirk said in the earnings call. "The reserves at Bagdad span decades, and they support expansion of infrastructure at the site to bring value forward. The incremental capital costs to build a new concentrator and support infrastructure for significantly higher mining and milling rates is on the order of $3.5 billion. And an expanded operation would not only substantially increase copper production, but would produce economies of scale and reduce unit costs."

However, Quirk acknowledged the environment for such a significant project remains iffy: "Given the tight labor market conditions and general market factors, we're not making a decision right now on the timing of the project."

Subscribers to Industrial Info's GMI Project Database can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Subscribers can click here for a full list of reports for active and planned U.S. projects from Freeport-McMoRan.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).

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