LME WEEK-Chile ups copper output forecast, sees higher surplus

Reuters

* Chile now seen producing 5.7 mln tonnes of copper in 2013

* Copper prices seen at $3.32/lb in 2013, $3.15 in 2014

* Chile raises copper surplus forecast by almost a third to294,000

LONDON, Oct 8 (Reuters) - Chile raised its copper outputforecast for 2013 and upped its global copper surplusexpectations by around 40 percent, on soaring global productionand slower demand growth, the country's mining minister said inLondon on Tuesday.

The country, the world's largest producer of copper, willproduce about 5.7 million tonnes of copper this year, anincrease of almost 5 percent on last year and a historic high,above previous estimates thanks to better output forecasts fromkey mines including Escondida, the world's largest.

State copper commission Cochilco in July had forecast theworld No. 1 copper producer's output would reach 5.53 milliontonnes this year.

Cochilco also raised its copper 2013 surplus expectations to294,000 tonnes, up from its previous forecast of 209,000, due tohigher production in Chile, the United States, Zambia andIndonesia and to lower demand for the metals from countries suchas India, Taiwan and South Korea.

It expects the market surplus to increase in 2014 to 327,000tonnes as new copper mining projects come on stream, in Chileand abroad.

The new estimate takes into account factors such as thestabilization of the Chinese economy and signs Europe is movingout of recession, said mining minister Hernán de Solminihac.

"The surplus estimate has increased but so has the priceestimate for this year," he told Reuters in an interview.

"We are monitoring the situation to see what is going on andwe have to manage what we can. We want to help Chile to become amore interesting place for foreign investors."

The country marginally raised its view for 2013 averagecopper prices to $3.32 per pound above the $3.27 per poundestimated earlier in the summer, after a better than expectedperformance in world markets during the third quarter.

It kept its 2014 copper price steady at $3.15 per pound.

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