Why Lundin Mining Lowered Its 2026 Copper Forecast

Winter storms knocked out power at Caserones, Lundin Mining's copper mine in Chile's Atacama region, for about 30 days in July and August, and snowmelt then slowed the haul trucks. Less ore reached the mill, and on November 4, 2026 the company lowered its Caserones forecast for the second time in three months, taking the company-wide copper range down with it.

The same results release reported revenue of US$1,109.2 million for the quarter ended September 30, 2026, up from US$953.9 million a year earlier. On November 5, the first full session after the release, the shares closed at C$28.05 on the Toronto Stock Exchange, down C$3.62 or 11.43 per cent, per end-of-day data read at 16:20 ET on November 5, 2026 from TMX Money (QuoteMedia).

Caserones produced less than half of last year's copper

Lundin Mining runs three producing copper operations in South America: Candelaria and Caserones in Chile, and Chapada in Brazil. The company reports their output on a 100 per cent basis, which means the full mine's production before any partner's share is deducted.

Total copper production was 62,610 tonnes in the third quarter, according to the November 4 release. The same quarter of 2025 produced 84,999 tonnes. Most of the gap came from Caserones, as the table shows.

Chapada was flat. Candelaria slipped about 6 per cent, which the company tied to harder ore and maintenance; it expects higher-grade Phase 12 ore to lift fourth-quarter volumes. Caserones fell by about 57 per cent.

The company's explanation is weather. Winter storms in the Atacama caused power outages and roughly 30 days of suspended operations, and the release says snowmelt then "reduced haulage rates and limited the volume of ore delivered to the mill." In an October 15 pre-announcement, the company said about US$66 million of Caserones costs would be classified as mine standby costs and kept out of its adjusted earnings measures. Of that, US$21 million was incremental storm cost and US$45 million was fixed overhead carried while the mine was idle.

The forecast moved twice at the same mine

Production guidance is the range a miner tells the market it expects to produce over a year. Lundin Mining had already cut Caserones once, on August 18, from 130,000 to 140,000 tonnes down to 120,000 to 130,000 tonnes. The November 4 release took it down again, to 105,000 to 115,000 tonnes.

The company-wide copper forecast fell with it. It is now 285,000 to 310,000 tonnes for 2026, down from 300,000 to 325,000 tonnes. Year-to-date production to September 30 was 219,421 tonnes, so the new range implies about 66,000 to 91,000 tonnes in the fourth quarter.

Other parts of the guidance did not change. Consolidated cash cost guidance for 2026 stays at US$1.95 to US$2.15 per pound of copper. Cash cost is the direct cost of producing a pound of copper, after credits for the gold and other metals sold alongside it. Gold guidance stays at 134,000 to 149,000 ounces. The 2026 capital spending forecast was lowered on November 4 to US$980 million from US$1,030 million.

Jack Lundin, the president and chief executive, described the Caserones shortfall in the release as "deferred tonnes rather than lost production." The company expects Caserones to recover through 2027 and plans to resume drilling at the Angélica area by the end of the fourth quarter. Deferred tonnes are ore that stays in the mine plan and is processed later. Lost production would leave the plan altogether. The company says the ore remains in the mine plan, and the recovery timeline is its own projection.

Record realized prices lifted revenue

The realized copper price was US$6.85 per pound in the three months to September 30, 2026, which the company called a record. A realized price is what the company was actually paid on its sales, including adjustments for shipments priced in earlier periods. The October 15 pre-announcement estimated those adjustments added about US$51 million to third-quarter revenue before tax. Gold sold for an average of US$4,321 per ounce.

Price explains how revenue rose while copper output fell by about a quarter. Third-quarter net earnings attributable to shareholders were US$228.9 million, or US$0.27 per share, against US$133.8 million a year earlier.

In the three months to September 30, 2026, operating activities brought in US$531.6 million, and free cash flow, the cash left after capital spending, was US$311.8 million.

In the release, the chief executive said the quarter was the company's "fourth consecutive quarter of revenue exceeding" US$1 billion. Its consolidated cash cost for the quarter ended September 30, 2026 was US$2.01 per pound, inside the unchanged guidance range.

The balance sheet ended the quarter with net cash

At September 30, 2026, the net cash reconciliation in the release showed cash and cash equivalents of US$344.3 million and US$107.3 million of debt due within a year. Cash less that debt equals the company's own net cash figure of US$237.0 million at September 30, 2026, so the company's measure counts no other borrowing. The company put the position at about US$200 million as at November 4. The interim financial statements and MD&A were filed on SEDAR+ on November 4; the figures here are from the condensed statements in the release.

Cash went back to shareholders in two ways. The board declared the regular quarterly dividend of C$0.0275 per share on November 4, payable on December 21, 2026 to shareholders of record on December 4. The company also bought back 2,448,400 shares in the third quarter for about US$62.4 million. Year to date to October 30, it had repurchased 6,098,494 shares at an average of about C$35.70.

On October 30, the company reported 851,371,131 common shares outstanding. The November 4 release reported no new share issuance or financing.

Vicuña is the project the company is building toward

Vicuña is a copper, gold and silver district on the border of Argentina and Chile, held in a 50/50 joint arrangement with BHP. It is the largest item in Lundin Mining's plans.

1. An integrated study published on February 16, 2026 (the Preliminary Economic Assessment technical report is dated March 30, 2026) put Stage 1 capital at US$7.1 billion and an after-tax net present value of US$9.5 billion at an 8 per cent discount rate. Net present value is the study's estimate of all future cash flows, discounted back to a single sum at the study date.
2. Argentina approved the project's application under its large-investment incentive regime, known as RIGI, in June 2026.
3. In the quarter ended September 30, 2026, a provincial agreement set up a US$250 million infrastructure trust, with a five-year payment holiday, and capped the provincial royalty at 3 per cent of gross revenue. Approval to build the high-voltage power line followed in the same quarter.
4. A sanction decision, the formal decision to build, is targeted "as early as the end of 2026," according to the release.

The first three steps are complete; the sanction decision has not yet been taken. The release reported Vicuña capital spending of US$81.0 million in the third quarter, and the 2026 budget for the company's 50 per cent share stays at US$395 million.

What the session did and did not show

The shares opened at C$31.11 on November 5, traded between C$27.565 and C$31.405, and closed at C$28.05, on 5,490,369 shares on the Toronto exchange, per TMX Money. The company has not commented on the share price, and no document links the move to any single item in the release. The guidance cut and the record price were both public before the session opened.

In my view, the quarter is a production miss at one mine, explained in detail by the company, inside a business that earned record prices and finished with net cash. The 66,000-tonne fourth quarter implied by the low end is the next test of the new range.

Shareholders of record on December 4 receive the C$0.0275 dividend on December 21, and Lundin Mining and BHP aim to decide on building Vicuña as early as year-end.