Business Monitor International


Peru Mining Report

Published 01 October 2014

  • 101 pages
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  • Includes 3 free updated quarterly reports
 
$1,295.00
Peru Mining Report

BMI View: We forecast average mining industry value growth of 2.3% per year from 2014-2018, reaching USD21.3bn. Both d omestic and international firms have projects in development, and the sector presents promising growth opportunities for miners of a wide array of minerals. The Peruvian government estimates current mining investment pipelines through 2020 to total nearly US D 5 7 bn, although continued protests by local communities is likely to reduce figure as project delays mount and costs rise.

We expect Peru's mining sector will see continued development given its significant untapped reserves and friendly investment framework. While we forecast positive annual growth to 2018, we revised down our industry value projections in light of recent data indicating a greater-than-expected contraction in both 2012 and 2013. Peru still remains a significant global producer of several base and precious metals, and we expect continued diversification as miners explore and develop new deposits. Copper projects accounting for the largest proportion of new mine projects and expansions. The sector is dominated by global copper mining majors including Southern Copper (a division of Grupo México), Freeport McMoRan and Glencore Xstrata, which are boosting output by both expanding existing operations and undertaking new investment projects.

Global Mining Leader
Peru - Share Of Global Output By Mineral, 2012

We expect Peru's central government will continue to encourage investment into the mining sector, though further conflict between local and central government interests is likely. We anticipate President Ollanta Humala will continue pursuing moderate policies, seeking to attract foreign investment while increasing social spending and implementing more accommodative policies towards Peruvian citizens and interest groups opposed to mining development. The tax code remains competitive, particularly in light of Mexican mining royalties imposed at the start of...

Table of Contents

BMI Industry View
7
SWOT
10
Industry Forecast
12
Copper: Growth Ahead Despite Environmental Concerns
12
Strong Growth Set For The Coming Years
12
Table: Peru - Select Copper Projects
13
Downside Risks Remain
14
Table: Copper Production Forecast (Peru 2010-2018)
15
Gold: Prospects Tarnished By Protests
15
Sector Remains Vulnerable Over The Coming Quarters
17
Table: Gold Production Forecast (Peru 2010-2018)
17
Lead: Modest Growth In Coming Years
17
Positive Price Outlook, But Financing Will Remain key
19
Table: Lead Production Forecast (Peru 2010-2018)
19
Silver: Peru To Coninue To Lead Output
20
Table: Peru - Key Silver Projects
21
Sector Challenges To Persist
21
Table: Silver Production (Peru 2010-2018)
22
Tin: Production Declines To Continue
22
Global Tin Dynamics To Favour Minsur
23
Table: Tin Production Forecast (Peru 2010-2018)
24
Zinc: Mixed Outlook Despite Production Growth
24
Table: Peru - Key Zinc Projects
26
Table: Zinc Production Forecast (Peru 2010-2018)
26
Industry Risk Reward Ratings
27
Risk/Reward Ratings
27
Rewards
27
Industry Rewards
27
Country Rewards
27
Risks
28
Industry Risks
28
Country Risks
28
Table: Mining Industry Forecasts (Peru, 2012-2018)
29
Risk/Reward Ratings
29
Colombia & Chile Remain At The Top
30
Table: Mining Risk/Reward Ratings
31
Mexico & Peru See Improvement, While Brazil Falls Back
31
Weak Prices & Poor Operating Environments Hold Others Back
32
Regulatory Development
33
Recent Developments
33
Balancing Between National & Local Goals
33
Tax Regime
34
Endemic Corruption
34
Table: Peru - Political Overview
35
Table: Regional Regulatory Index
37
Commodities Forecast
38
Commodity Strategy
38
Iron Ore: Not Much Respite In Sight
38
Steel: Production Rationalisation Too Slow To Provide Price Upside
40
Aluminium: Further Price Rally Unlikely
41
Lead: Ripe For A H214 Boost
42
Copper: Consensus Moving Our Way
43
Nickel: Price Surge To Abate Further
44
Tin: In A Sweet Spot
45
Zinc: Bullish Short-Term Picture
46
Table: Select Commodities - Performance & BMI Forecasts
48
Competitive Landscape
49
Table: Financial Data - Key Mining Firms Listed In Peru
49
Gold & Silver Prospects Slightly Tarnished
50
Company Profile
51
Buenaventura
51
Latest Financial Results
53
Table: Buenaventura - Key Financial Data
53
Glencore Xstrata
54
Latest Financial Results
56
Table: Glencore Xstrata - Key Financial Data
58
First Quantum
59
Latest Financial Results
62
Table: First Quantum: Key Financial Data
63
Grupo M-xico
64
Table: Grupo M-xico - Key Financial Data
66
Regional Overview
68
Americas Overview
68
1
68
2
69
Table: Americas - Regulatory Updates
70
3
71
4
72
5
75
Global Industry Overview
77
Challenges
77
Table: Mining - Select M&A Deals
81
Cause For Optimism
84
Methodology
91
Industry Forecast Methodology
91
Sources
92
Risk/Reward Rating Methodology
93
Table: Weighting Of Indicators
95

The Peru Mining Report has been researched at source and features Business Monitor International (BMI)'s mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.

BMI's Peru Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Peru.

Key Benefits

  • Use BMI's independent industry forecasts on Peru to test other views - a key input for successful budgeting and planning in this mining market.
  • Target business opportunities and risks in Peru's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Peru.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI's key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

Business Environment Rankings

BMI's Mining Business Environment Rankings provide a country-comparative Risk-Reward Rankings index aimed at investors (mining companies and support service providers) in the regional mining market. The rankings methodology makes sophisticated use of over 40 industry, economic and demographic data points and is part of BMI's integrated Country Risk-Industry rankings products.

Key Projects

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.

BMI Industry Forecasts

Historic data series (2009-2012) and forecasts to end-2018 for all key industry and economic indicators (see list below), supported by explicit assumptions, plus analysis of key downside risks to the main forecast. Indicators include:

  • Mining Industry: Industry size (US$mn), real growth (%), % of GDP, employment ('000), workforce as % of total workforce, average wage (US$).
  • Output:Production volumes ('000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
  • Exports: Value of exports (US$mn) for all major metals, minerals, ores and gems mined in each state .
  • Commodity Markets: Global demand, supply, stocks and benchmark prices (US$) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.

BMI Macroeconomic Forecasts

BMI forecasts to end-2018 for all headline macroeconomic indicators, including real GDP growth (%), inflation (%), fiscal balance (% of GDP), trade balance (US$bn), current account (US$bn) and external debt (US$bn).

Competitive Landscape Tables & Analysis

Comparative company analyses and tables detailing by US$ sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.

Company Profiles

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc