Teck base metal production mixed in 3Q

Canada-based Teck Resources' copper and lead production rose in the third quarter while zinc dropped on higher costs, low zinc prices and a mine closure.

Copper output in the third quarter grew to 79,000t, up by 10pc from the third quarter of 2018. Production in the first nine months of the year was higher at 226,000t, an increase of 2pc compared with the same period last year.

Increased output in the third quarter was primarily because of higher copper ore grades, mill throughput and recoveries at Highland Valley Copper in British Columbia, Teck said yesterday.

The producer expects to be within its original production guidance in 2019 of 290,000-310,000t. Teck expects fourth quarter production, excluding the Carmen de Andacollo mine in Chile that is currently on strike, to be 60,000-65,000t. Its net cash costs for copper after by-products was $0.02/lb higher at $1.31/lb in the quarter compared with the same period last year.

The copper metal market remains under pressure from the macroeconomic slowdown and trade disputes, the producer said. Still, even with expected lower global metal demand growth, the market is expected to remain in a supply deficit in 2019 and into 2020, it said.

Teck's copper project Quebrada Blanca Phase 2 in northern Chile remains on target and is scheduled for a fourth quarter 2021 completion and a ramp-up to full production in 2022. This project will have a 300,000 t/y capacity in the first five years and has a mine life of 25 years.

Refined zinc production dropped by 3pc year on year to 72,000t in the third quarter, while output in January-September fell to 221,000t, down by 7,000t compared with a year earlier.

Mine production globally is under pressure with high cost mines struggle with low zinc prices and higher treatment charges, Teck said.

Teck expects zinc production guidance to hold for 2019 at 620,000-650,000t, despite the early closure of its Pend Oreille mine in Washington. But because of an electrical equipment failure at its Trail Operations in British Columbia, Teck expects refined zinc production in 2019 to be in the range of 275,000-285,000t, down from the previous guidance of 305,000-310,000t as repairs are expected to be completed by mid-December.

Mining and concentration production in Pend Oreille were placed on care and maintenance on 31 July. With the suspension, the third quarter zinc production dropped to 2,600t which was 5,300t lower than a year earlier.

Refined lead output at Trail Operations in the same quarter rose by 15pc year on year to 17,100t, partially because of the planned 2018 major maintenance shutdown of the smelter and the August 2018 wildfire smoke that curtailed some of the facilities temporarily.

Canada-based Teck Resources is the third largest zinc producer in the world, operating mines in Chile, Peru, the US and Canada. Teck also produces molybdenum and silver.