Teck cuts copper output forecast as Anglo reaffirms $53B merger plan

Teck Resources trims copper output guidance for 2025 amid challenges at its Quebrada Blanca mine in Chile, while Anglo American reaffirms confidence in their $53B merger deal.

Teck Resources (TSX: TECK.A, TECK.B)(NYSE: TECK) has lowered its copper production outlook for 2025 following ongoing operational setbacks at its Quebrada Blanca (QB) mine in Chile and Highland Valley Copper (HVC) in Canada, even as it moves forward with a $53-billion merger with Anglo American (LON: AAL).

Production guidance trimmed amid persistent challenges

Teck now expects to produce 170,000–190,000 tonnes of copper in 2025, down from its previous range of 210,000–230,000 tonnes. The company attributed the downgrade to prolonged downtime required to raise the tailings dam crest at QB. Output for 2026 has also been cut to 200,000–235,000 tonnes from 280,000–310,000 tonnes.

Third-quarter results showed 39,600 tonnes of copper output and 43,900 tonnes of sales from QB. Teck said continued tailings management facility (TMF) development will limit output and trigger additional concentrator shutdowns throughout 2025, particularly in the third quarter.

Net cash unit costs for 2025 are now projected at $2.65–$3.00 per pound, compared with $2.25–$2.45 previously. The miner expects costs to decline to $2.25–$2.70 per pound in 2026 as production stabilizes.

Optimization work at QB, intended to raise throughput by 5–10%, has been pushed beyond 2027–2028 due to continued TMF-related delays. Teck also cautioned that if sand drainage improvements or TMF construction progress fall short, copper output in 2026 and 2027 could face further disruption.

Despite the lowered forecast, Teck’s shares rose modestly on Wednesday — up 0.6% in Toronto to C$59.99 and 1.6% in New York to $43.12, valuing the company at roughly $21 billion.

Merger with Anglo remains on track

Anglo American, which announced plans in September to merge with Teck in a $53-billion all-share deal, said it “fully supports” Teck’s updated outlook, describing the revisions as consistent with findings from its own operational review.

The London-based miner reaffirmed that the strategic rationale and projected synergies of the merger remain intact. Anglo also expressed confidence in Teck’s “measured ramp-up” at QB, citing its own experience resolving similar startup issues at Quellaveco in Peru.

Anglo and Teck anticipate that the merger will generate an annual EBITDA uplift of $1.4 billion by combining QB and Anglo’s Collahuasi mine in northern Chile, along with $800 million in recurring synergies.

A project under scrutiny

Once envisioned as a cornerstone of Teck’s copper growth strategy, Quebrada Blanca has been plagued by technical setbacks and cost overruns. The expansion has run over 80% above budget and is several years behind schedule, with past challenges including pit instability, ship-loader failures, and waste storage bottlenecks.

Meanwhile, at Highland Valley Copper in British Columbia, Teck reduced its 2025 production guidance to 120,000–130,000 tonnes from an earlier 135,000–150,000 tonnes, citing lower ore grades and maintenance downtime.

Teck CEO Jonathan Price said the revised plan reflects “realistic performance assumptions and risk assessments” and underscores the company’s commitment to restoring reliability across its copper portfolio.

Despite the headwinds, both companies reaffirmed that Quebrada Blanca’s long-term potential remains intact, with Teck noting that when tailings development is not a constraint, the mine achieves recovery rates of 86–92%, consistent with design targets.