Title: Business Opportunities: Chilean Mining Industry
1Business OpportunitiesChilean Mining Industry
- Carlos F. Capurro
- Senior Commercial Advisor
- U.S. Commercial Service
- Santiago, Chile
Image courtesy NASA GSFC, MITI, ERSDAC, JAROS,
and U.S./Japan ASTER Science Team
2Chile?
3Geography
- 2,600 miles long
- Just 100 miles wide (average)
- Diverse climate and geography
- Opposite seasons from the U.S.A.
- Isolated by mountains, desert and sea
- 16 million population
- Principal city and capital - Santiago
4Brief History
- Spanish Colony 1541 1810
- Socialists take power 1970
- Military coup 1973
- Chicago Boys take charge
- Open economy begins to grow - 1974
- Structural changes - 1981
Democratic elections in 1989
5Chile Today
- President Michelle Bachelet took office
March 11, 2006 (2006-2010) - Concertacion Coalition
- Socialists
- Party for Democracy
- Christian Democrats
- Broad Consensus No Change
- Open Economy Free Market
- Democratic Institutions
6Why Chile?
7Sustained Economic Growth
8Unemployment Level
Source Banco Central de Chile
9Price StabilityAnnual Inflation ()
10Business - Why Chile?
- Free Trade Agreements
- Steady economic growth
- Prudent fiscal policies
- Stable democratic government
- Solid business practices
- Rule of law
11U.S.-Chile Trade Agreement
Effective January 2004
- 95 of bilateral trade in goods duty-free
- 75 of U.S. farm goods duty-free by 2008
- Stronger protection of intellectual property
rights (IPR) - Open and fair government procurement
- Commitments on labor rights and environmental
protection
Visit our U.S. Exporters Guide to the US Chile
FTA at http//www.buyusa.gov/chile/en/ftaguide.htm
l
12U.S.-Chile Trade Merchandise/Goods (In US
Billion)
13Best Prospects for U.S. Exports
- Construction
- Computer Hardware / Software Services
- Electric Power Equipment
- Environmental Technologies Services
- Financial Services
- Food Processing Packaging Equipment
14Best Prospects (cont.)
- Medical Equipment Healthcare
- Mining Equipment
- Plastics Machinery Materials
- Security Equipment Safety
- Telecommunications Equipment Services
- Travel Tourism
15Mining Industry Overview
Market Overview U.S. Position Competitors Commerc
ial Opportunities Other Resources
16Market Overview
- Mining explains 7.8 of Chiles GDP and 66 of
the nations overall exports in 2007. - Chile is the worlds number one producer of
- Copper 37.5
- Molybdenum 28.1
- Sodium Potassium Nitrate 100
- Lithium 42
- Iodine 55
17Market Overview
- Chile is also a large producer of
- Borates (9.9)
- Silver (7.3 )
- Gold (1.8 )
- Rhenium
- And produces substantial amounts of gold and
silver
18Market Overview
Market Size
- 130 Mining companies (5.7 million tons)
- 18 companies produce 70
- 275 supplying companies
- APRIMIN 50 companies Selling US 3.5 billion
(47 imp.) - 1,800 reps/distributors
- 2,500 products services
19Market Overview
- Expects to average annual growth of 6 from
2008-2015 - Projected investments exceeding US 15 billion
- Foreign investment has been the key 1974-2006
21 billion or 33 of all foreign investment.
20Market Overview
Foreign Direct Investment in Mining(21.1
billion 1974-2006)
Source Chilean Foreign Investment Committee
21Chile Mining Imports
Market Overview
Billion
Source COCHILCO, based upon Chilean Customs Data
(Sept. 2007)
22Market Share by Main Supplying Countries
Market Overview
U.S.-Chile FTA
Source COCHILCO, based upon Chilean Customs Data
(Sept. 2007)
23Competing Mining Suppliers Market Share by
Country(2007)
Source Chilean Customs Data
24Copper Prices January 1998 2008( cents/lb)
Feb 22, 2008 ? 378 cents /lb
Source Chilean Copper Commission COCHILCO
(www.cochilco.cl)
25New Copper Mining Projects(2008-2015)
Source COCHILCO Based on companies press
releases and own data compilation
26How this translates intoreal business?
2005 2.9 billion Operational Expenses
27How to translate all this intoreal business?
Capital Goods Demand
- Cranes
- Screening machines
- Environmental system solutions (water treatment,
air pollution/dust abatement, mine closures) - Underground mining technology services
- Wear-resistant materials
- Off-road trucks (240-440 tons)
- Scoop shovels
- Giant tires
- Crushers
- Grinders
- Cabbed truck chassis ( 50 tons)
- Part for rock cutters
- Excavators
Source Revista Minería Chilena, Ministry of
Mining, El Mercurio, Diario Financiero
28How to translate all this intoreal business?
2005 1.7 billion Imports
29How this translates intoreal business?
2007 5.7 million tons of copper
2011 6.5 million tons of copper
Yearly Demand US Million/Year
65 off road load trucks 247
19 giant front loaders 74
Drilling and underground transportation equipment 22
24,800 tons Explosives 16
24 LHD 11
500 Tires 10
Source COCHILCO, Dec. 2007
30How to translate all this intoreal business?
Electronic Purchasing Systems
- Quadrem ? www.quadrem.com
- CODELCO ? www.codelco.com
- Chile Compras ? www.chilecompras.cl
- SICEP ? www.sicep.cl
31A Must
EXPOMIN
EXPOMIN Santiago, May 2008 www.expomin.cl
EXPONOR Antofagasta, June, 2009 www.exponor.cl
32Need Help?Count on Us!
- U.S. Commercial Service
- Carlos F. Capurro
- carlos.capurro_at_mail.doc.gov
- Tel 011-56-2-330-3307
- Fax 011-56-2-330-3172
- Andres Bello 2800, Las Condes, Santiago
- Chile
33Looking forward to see you soonin Chile
- Many thanks for you kind attention