Codelco First-Half Profit Quadruples as Copper Rally Masks Production Decline

Chilean state-owned miner Codelco reported a more than fourfold increase in first-half profit, as a surge in global copper prices successfully offset a sharp decline in production and rising operational costs. The results highlight the financial benefit of the current commodities rally for the world's largest copper producer, even as it grapples with significant mine-level disruptions.

Prices Drive Record Earnings

Codelco announced a pre-tax profit of $1.97 billion for the first half of 2026, a substantial jump from the $429 million posted in the same period a year prior, according to its Friday report. The primary driver for the earnings growth was the significant increase in the price of copper.

The company’s realized copper price climbed to 653.2 cents per pound, a sharp increase from 461.7 cents per pound in the first half of 2025. This price surge provided a major tailwind to revenue, more than compensating for weaker operational performance.

Operational Challenges Persist

Despite the strong earnings, Codelco's copper production fell 11% year-over-year to 564,000 metric tons, down from 634,000 tons. The company attributed the decline to several issues, including:

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• Operational restrictions at its key El Teniente mine
• Lower output at the Chuquicamata mine
• Weaker ore grades at its Ministro Hales operation

The lower production volumes directly contributed to higher expenses. Codelco's direct cash cost, a key industry metric, rose 7% to 231.6 cents per pound.

Outlook and Management Focus

New Chief Executive Jorge Gomez stated that the company's priority is to restore productivity following these setbacks. The results come as Codelco reviews its investment priorities and debt burden in an effort to reverse several years of production declines.

Codelco did not update its full-year 2026 production forecast in the report. However, Chairman Bernardo Fontaine said earlier in the month that the company's previous target of 1.33 million to 1.36 million tons would be "difficult to achieve" given the current output trend.