Cochilco raises 2009 average copper price outlook to $2.30/lb but trims output forecasts

The group also raised 2010 estimates to $2.70 on the back of "dynamic" growth in demand from China

SANTIAGO (Reuters)  - 

Chile's state copper think tank, Cochilco, on Wednesday raised its 2009 average copper price outlook to $2.30 per lb from $1.95, but slightly trimmed its 2009 copper output forecast to 5.38 million tonnes.

The think tank also raised its copper price forecast for 2010 to an average of $2.70 per lb from $2.10 per lb, citing dynamic Chinese demand and expectations of a recovery of developed economies from global crisis.

Cochilco slightly lowered its forecast for Chile's 2009 copper output to 5.38 million tonnes from a previous forecast of 5.4 million tonnes this year, seeing production up 1 percent versus 2008 levels. Chile is the world's No. 1 copper producer.

It also raised its 2010 copper output forecast to 5.78 million tonnes versus a previous view of 5.75 million tonnes.

"Vigorous Chinese demand has maintained prices firmer than previously expected, which we expect to continue for the rest of the year," Cochilco said in a report on copper market trends during the third quarter, citing bigger-than-expected Chinese imports.

Chinese demand should fall in 2010 as it uses up metal stockpiled this year, Cochilco said.

Cochilco last month forecast rising mining investment in Chile during the next five years will lift the country's copper output more than 38 percent by 2020 to 7.4 million tonnes, compared with 2008 output of 5.3 million tonnes.

Copper prices HGZ9MCU3 have risen about 115% so far this year after plunging from record highs last year amid global financial crisis has helped the South American country, which relies on the metal for much of its revenues. (Reporting by Rodrigo Martinez, Simon Gardner and Aaron Nelsen; Editing by Lisa Shumaker)

© Thomson Reuters 2009 All rights reserved

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