Freeport-McMoRan quarterly profit plunges on lower copper prices By Reuters

(Reuters) – Copper miner Freeport-McMoRan (NYSE:) Inc reported a 37% drop in fourth-quarter profit on Wednesday as prices for the red metal plunged on recession fears, rising prices interest rates and COVID-induced lockdowns in major consumers. Porcelain.

Average prices averaged $8,004.64 per ton in the final three months of 2022, a 16% drop from the prior-year period, as China’s economic growth weakened while Europe and the United States faced recession.

Miners are also struggling with higher inflation, lower demand, and rising cost of production per unit.

Freeport reported average realized copper prices of $3.77 per pound, compared with $4.42 a year earlier.

The miner, which has operations in the Americas and Indonesia, said quarterly production of the red metal rose about 4% to 1.07 billion pounds from a year earlier. Its gold production increased to 472,000 ounces from 405,000 ounces.

The Phoenix-based company also expects its annual capex to be around $5.2 billion, up from the $3.5 billion targeted in 2022.

Freeport’s net income fell to $697 million, or 48 cents a share, in the three months ended December 31, from $1.1 billion, or 74 cents a share, last year.

The outlook for copper fundamentals in the medium to long term remains favourable, the miner said, adding that market confidence improved after China reopened its borders. Growing demand from global decarbonization initiatives and low inventories also support the outlook.

Excluding one-time items, the miner posted a quarterly profit of 52 cents per share, above analysts’ estimate of 46 cents per share, according to Refinitiv data.