SANTIAGO: Mining group Anglo American sees its copper output jumping this year as its disputed Los Bronces mine in Chile gears up, while a chronically undersupplied and volatile market will briefly tilt into surplus next year, a top executive said. Copper demand will expand a robust 5 to 6 per cent this year due to voracious consumption in China and a pick-up in the developed world, leading to a 150,000 tonne to 200,000 tonne deficit, said Anglo copper chief executive John MacKenzie. "We have a positive outlook on copper demand," MacKenzie told reporters. "But for me the most important is copper supply and that's the complicated part, because its difficult to see how the market will sustain enough production growth to keep up with demand." New projects coming on line will ease the global copper market into a brief surplus as of 2013 before a shortage re-emerges by 2016, he said. Copper prices rose 11 per cent in the first quarter of 2012, the biggest quarterly rise since surging near 20 per cent in the last quarter of 2010, buoyed by healthier economic signals in the United States and receding debt fears in Europe. But bears have gained the upper hand since the second quarter kicked off on fears of ebbing demand in China and a meeker-than-hoped-for recovery in the United States. Prices plunged 4 per cent on April 10 alone and fell below $8,000 a tonne on Friday in London for the first time in three months. "Macroeconomic factors will have an impact on short-term price volatility, but in the medium and long-term, fundamentals are very solid," MacKenzie said. RAMPED-UP BRONCES TO OFFSET COLLAHUASI DIP Anglo expects its 2012 copper output to be above the 599,000 tonnes produced last year, as its ramped-up flagship Los Bronces mine counters a forecast drop in world No. 3 copper mine Collahuasi, also 44 per cent owned by Xstrata Plc. "The production increase in Los Bronces is more than the drop, due to ore grades, in Collahuasi," MacKenzie said. "Therefore, we're expecting a production increase this year."

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