SCCO Lowers 2026 Production Forecast: Could a Significant Recovery Be on the Horizon?

Southern Copper Corporation: Production Update and Future Outlook

Southern Copper Corporation (SCCO) reported copper production of 956,270 tons for 2025, marking a slight 1.8% decrease from the previous year and coming in 1% below its forecast. This reduction was mainly due to lower yields at the Buenavista and Peruvian operations, though increased output at the IMMSA and La Caridad mines helped offset some of the decline.

Looking ahead, SCCO anticipates copper production to fall further in 2026, with an estimated output of 911,400 tons—a 4.7% drop from 2025—largely attributed to diminishing ore grades at its Peruvian sites. Despite these short-term challenges, Southern Copper remains optimistic about its long-term prospects, aiming to boost annual production to approximately 1.6 million tons by 2035. This goal represents a projected compound annual growth rate (CAGR) of about 5.3% from 2025 levels.

To achieve this ambitious expansion, the company plans to invest nearly $19.9 billion over the next ten years, focusing primarily on projects in Peru. The majority of this capital will be deployed through 2031 as major development initiatives advance.

Production is expected to reach around 1.15 million tons by 2031, climb to roughly 1.476 million tons in 2032, and continue rising to meet the 1.6 million ton target by 2035. This growth trajectory underscores SCCO’s confidence in its diverse project pipeline across Peru and Mexico.

• The Tia Maria project in Arequipa, Peru, is set to begin operations in 2027, with an annual capacity of 120,000 tons of SX-EW copper cathodes.
• El Pilar in Mexico is scheduled to start in 2029, contributing about 36,000 tons of copper cathodes each year.
• The El Arco project in Baja California is expected to launch by 2030, adding around 190,000 tons of copper annually. This site will feature an open-pit mine, a 120 ktpd concentrator, and a 28 ktpy SX-EW operation.
• Los Chancas in Peru is projected to add 130,000 tons of copper starting in 2031, while Michiquillay is expected to contribute 225,000 tons in 2032, potentially becoming one of the largest copper mines in Peru.

This phased, multi-location development strategy suggests that current production softness may transition into a period of sustained growth over the coming decade.

Industry Peers: BHP Group and Teck Resources

BHP Group (BHP) produced 984,000 tons of copper in the first half of fiscal 2026. The Escondida mine achieved record concentrator throughput and improved recoveries, while Copper SA also set new mining records.

For fiscal 2025, BHP reported a record 2,017,000 tons of copper, an 8% increase year-over-year and the first time surpassing the 2 million ton mark. The company’s target for fiscal 2026 is between 1.9 and 2 million tons, up from the previous guidance of 1.8 to 2 million tons. BHP’s project pipeline could add up to 2 million tons per year of attributable copper production by the 2030s.

Teck Resources (TECK) delivered approximately 454,000 tons of copper in 2025, a 1.8% increase from the prior year. The company forecasts copper output of 455,000–530,000 tons for 2026, 505,000–580,000 tons for 2027, and 435,000–510,000 tons for 2028.

Teck has agreed to merge with Anglo American plc, forming the Anglo Teck group. This new entity will have over 70% of its portfolio in copper, including six world-class copper assets and leading iron ore and zinc operations. Combined annual copper production is expected to reach 1.2 million tons, with a projected 10% increase to 1.35 million tons by 2027.

SCCO: Stock Performance, Valuation, and Analyst Estimates

Over the past year, Southern Copper shares have surged 126.5%, outpacing the industry’s 102.8% growth.

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SCCO currently trades at a forward 12-month price-to-sales ratio of 11.95, significantly higher than the industry average of 5.49.

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The Zacks Consensus Estimate places Southern Copper’s 2026 earnings at $6.36 per share, indicating a 21.4% increase from the previous year. However, the estimate for 2027 suggests a 12.6% decrease. The chart below shows how EPS estimates for 2026 and 2027 have changed over the past two months.

Image Source: Zacks Investment Research

Currently, SCCO holds a Zacks Rank #3 (Hold).

For a full list of today’s Zacks #1 Rank (Strong Buy) stocks, click here.

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Additional Resources

Looking for the latest stock recommendations from Zacks Investment Research? Download the 7 Best Stocks for the Next 30 Days here.

• BHP Group Limited Sponsored ADR (BHP): Free Stock Analysis Report
• Southern Copper Corporation (SCCO): Free Stock Analysis Report
• Teck Resources Ltd (TECK): Free Stock Analysis Report

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