Copper Fundamentals Remain Strong: CEO
After a slump in third-quarter earnings, Richard Adkerson, Freeport McMoran Copper & Gold CEO, told CNBC's "Closing Bell" on Monday, he's still optimistic about his business and copper fundamentals longer-term.
During the third quarter, the world's largest listed copper and gold miner reported a 22-percent drop in earnings and a 15-percent decline in revenue. Adkerson attributed the declines to "unusual" production issues at its Grasberg mine in Indonesia.
"We produced on a gross basis half the normal levels of copper and gold that we normally produce," the Freeport McMoran executive said of its Indonesian operations. "Other than that, our business performed very well. Our operations in the Americas and Africa were above expectations."
Adkerson expects that next year it will return to more normal production in Indonesia and its expansion projects will add volume. (Read More: How Cramer's Playing Gold.)
Adkerson said he's not that worried about a slowdown in China.
"There's obviously a slowdown," he said. "The Chinese government took steps last year to rein in inflation and that's having the desired effect." But the executive noted that Freeport McMoran is still "very successful" placing products in China. (Read More: No Recession, but Plenty of Uncertainty: Caterpillar CEO.)
Copper supply constraints also keep Adkerson optimistic about copper pricing longer-term and with a large copper mines it is well placed to benefit from tight supply.
"We're taking this big resource base, we have near-term expansion projects, a pipeline of longer term projects before us and that's going to allow us to deliver large quantities of copper to a world that will need it and pay good prices for it," Adkerson said.