Bachelet pledges mining reforms, including royalties, to help finance programs

Wednesday, August 14th 2013 - 19:24 UTC

Full article 5 comments

Chile's presidential frontrunner Michelle Bachelet says she is studying possible changes to mining policy in the world's top copper producing country. The possible changes include altering mining royalties and funding programs for state-owned mining company Codelco. Read full article

Comments

Disclaimer & comment rules

Condorito
As long as Mami limits herself to “studying” possible changes we are ok... or is she going to surprise us with plans to privatize CODELCO?
Aug 14th, 2013 - 08:07 pm - Link - Report abuse 0
-+
Anglotino
Sounds like there is a lack of shallow, quick fixes on offer!

Looks like Chile might win either way.
Aug 14th, 2013 - 08:18 pm - Link - Report abuse 0
-+
ChrisR
But the 15.78% drop in revenue for copper in just over two years hasn't been matched by a 16% drop in the cost of winning the ore and processing it I bet. Any idea what the gross margin was in 2011? A hell of a lot better than now is the answer.

All politicians promise things and most never deliver, especially when half of the exports are tied to something, the revenue of which, is dropping like this.

Trouble is the electorate of all countries love “bread and circuses”.
Aug 15th, 2013 - 11:26 am - Link - Report abuse 0
-+
Condorito
Chris, you are right. In fact production costs have risen as copper price has fallen: wages and energy prices are both higher.
Aug 15th, 2013 - 12:48 pm - Link - Report abuse 0
-+
ChrisR
4 Condorito

Thank you for that I am not surprised though.

Politicians of all countries seem unable or unwilling to grasp the basic facts of what businesses need to do:
1) MAINTAIN YOUR CAPITAL AT ALL COSTS. If the banks are into you for real money then the business is not yours, it’s theirs!

2) Maintain a very close watch on fixed and variable costs. Apart from employment costs (more or less workers) everything else is outside your control (as long as you keep waste to a minimum).

3) In a copper production business your selling price is the market price and that’s it basically.

4) If 3) is LESS than 2) then 1) is at risk of being depleted! Then things get very difficult indeed.

In general, unless 3) increases or 2) reduces, the business is doomed to long term decline but the smart investors will be out long before that. The problem is however you have the dumbest investors possible: the government who have their own, political agenda.
Aug 15th, 2013 - 01:23 pm - Link - Report abuse 0
-+

Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!