36% Zinc Output Surge Cuts Southern Copper’s Cash Cost to $0.58 per Pound
TECK•Southern Copper’s zinc production jumped 36% year-over-year in 2025, driven by output from the new Buenavista zinc concentrator. This increase boosted by-product revenue credits by $0.34 per pound, cutting net cash cost of copper to $0.58 per pound and offsetting a guided 4.7% drop in copper output next year.
1. Zinc Production Growth
Southern Copper achieved a 36% year-over-year increase in zinc production during 2025, primarily due to commissioning of the Buenavista zinc concentrator. Management prioritized high-grade zinc ore in this facility, unlocking substantial by-product output beyond initial forecasts.
2. Impact on Cost Structure
Higher zinc volumes elevated by-product revenue credits by $0.34 per pound, driving the company’s net cash cost of copper down to $0.58 per pound. These credits reduce the effective cost of copper production, strengthening profitability despite wider market pressures.
3. Offsetting Copper Volume Decline
The company has guided for a 4.7% reduction in copper output next year due to lower ore grades at Peruvian operations. The surge in zinc revenue provides a strategic hedge, allowing management to maintain margins and focus on higher-value metallurgical assets.
