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(Sharecast News) - Shares in Antofagasta fell on Thursday, amid wider pressure on mining stocks, after a third-quarter production update from the mining blue chip underwhelmed.
The Chilean-focused business saw copper production rise 7% quarter-on-quarter to 151,900 tonnes, boosted by higher output at its Los Pelambres mine. Copper sales jumped 30.5% to 170,700 tonnes.
However, consensus had been for a slightly higher rise in production, to 155,000 tonnes.
Gold production was also weaker, down 4.3% at 44,300 tonnes, on the back of lower grades at Los Pelambres and Centinela Concentrates, where workers have recently started industrial action.
In the year-to-date, copper production fell 8.3% to 436,900 tonnes.
Looking to the full year, and the group left forecasts unchanged for copper production of between 625,00 and 655,000, reflecting higher grades at Los Pelambres and lower grades at Centinela.
But guidance for cash costs before by-product credits was raised to between $2.60 and $2.70 a pound, on the back of the spike in global diesel prices. It had previously guided for costs of between $2.40 and $2.60 a pound.
As at 1000 BST, the stock had shed 6% at 3,347p.
Ivan Arriagada, chief executive, said Los Pelambres had shown "resilience" after being hit by adverse weather in July.
He continued: "Construction activities across our major growth projects at Centinela and Los Pelambres are progressing well, and we have entered the final phases of each schedule, ahead of construction and commissioning activities completing in 2027. These projects will deliver significant growth and strengthen the resilience of our portfolio.
"The copper market continues to demonstrate strong fundamentals."
Dan Coatsworth, head of markets at AJ Bell, said a tech-related slide in copper prices had triggered a sell-off in base metal producers. "Tech investors are getting uncomfortable with the amount of debt being used to fund the AI build-out," he argued.
"Miners like Antofagasta and Anglo American were seen as prime beneficiaries of the AI boom, as copper is a crucial raw material for the power build nuts. Any idea of an AI bubble, and one that is primed to bust, could fuel fears that copper demand might not live up to lofty expectations."
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