US-based copper producer Freeport-McMoRan expects tariffs to increase the costs of goods needed for operations by 5pc, as suppliers will likely pass on tariff-related costs.
The 145pc tariffs imposed by the US on China on 10 April will likely have the largest influence on the estimated 5pc increase, according to Freeport-McMoRan chief executive officer Kathleen Quirk.
Approximately 40pc of the company's US costs will not be subject to tariffs, as they relate to labor and services.
Copper is currently exempt from tariffs after President Donald Trump signed an executive order on 25 February launching a Section 232 investigation into the effect of copper imports on US national and economic security.
Freeport said that its first quarter copper sales volumes of 872mn lbs exceeded its earlier estimate of 850mn lbs. But copper sales revenue decreased to $872mn this quarter from $1.1bn the first quarter of 2024.
Copper production and sales were pressured in the quarter by shut operations at its Manyar smelter in Indonesia following a fire in October. The company expects start-up activities to begin at the smelter in the second quarter and return to full operations by the end of 2025.
The company's molybdenum first quarter sales remained the same as 2024 first quarter's at $20mn.
Freeport's net income for the first quarter was $352mn, a decrease from $473mn in the first quarter of 2024.
