Phoenix based Southern Copper said that it has increased its copper production guidance for 2009 to 490,000 tonne from 470,000 tonne largely thanks to record Q2 red metal production at the Ilo smelter in Peru.

Mr Genaro Guerrero CFO of Southern Copper during a conference call said that throughput at Ilo last quarter amounted to 298,000 tonne.

He said that the company inched up its zinc production forecast for this year to 105,000 tonne from 101,000 tonne while silver guidance is unchanged at 17Moz. Meanwhile, Mr Guerrero believes that supply demand dynamics will support copper prices above USD 2.00/lb in Q4 and 2010.

Mr Guerrero said that inventories at major metals exchanges have been equivalent to some eight days of global consumption recently adding that during the low metals price cycle of 2001-02 inventory represented about 32 days of consumption.

He said that the company's cash costs for the second quarter were USD 1.50/lb not considering byproduct credits.

(Sourced from BNamericas)