Freeport-McMoRan reached two-thirds of normal milling rates at its Grasberg copper-gold complex in Indonesia during the third quarter of 2026, following a deadly mudslide that halted operations last year. As mining.com reported, the site processed roughly 140,000 tonnes of ore daily, matching an operational recovery that positions the company to approach full capacity by late 2027.
The Bottom Line
- Throughput Recovery: Grasberg mill operations averaged 67% of normal capacity during Q3, processing approximately 140,000 tonnes of ore daily.
- Financial Guidance: Unit net cash costs are expected to edge up to $2.10 per pound of copper, offset by realized copper prices exceeding $6.50 per pound.
- Production Timeline: Freeport-McMoRan (Freeport-McMoRan (NYSE: FCX)) targets 80% capacity by mid-2027 and near-full production by the end of next year.
Milling Rates and Underground Progress at Grasberg
The third-quarter average of 140,000 tonnes of ore per day outperformed expectations from BMO Capital Markets, which had modeled a 65% operational rate. According to mining.com.au, the Grasberg Block Cave underground mine contributed roughly 70,000 tonnes of the daily mill feed. Upgrades to the underground material-handling system remain on schedule for completion in early 2027.
Energy Metal News notes that a quarterly milling average measures processing pace rather than a static exit rate or immediate metal output. While throughput signals operational recovery, final metal production depends on ore grades and extraction efficiency. Freeport aims to restart Production Block 1S by mid-2027, a milestone expected to lift capacity to 80% before reaching full utilization.
Sales Volumes and Cost Adjustments
Freeport produced roughly 830 million pounds of copper and 230,000 ounces of gold during the quarter ended September 30. While copper sales remain on track at approximately 750 million pounds, gold sales are projected at 100,000 ounces due to a scheduled shift of 60,000 ounces of refined metal into the fourth quarter.
| Metric | Q3 2026 Expected / Actual | Prior Estimates / Context |
|---|---|---|
| Copper Production | ~830 million lb. | In line with company expectations |
| Copper Sales | ~750 million lb. | Matching July forecast |
| Gold Production | ~230,000 oz. | In line with expectations |
| Gold Sales | ~100,000 oz. | 60,000 oz. deferred to Q4 |
| Unit Net Cash Costs | ~$2.10 per lb. of copper | Up from $2.00 July estimate |
Deferred gold sales reduced the byproduct credits used to offset copper production expenses, pushing unit net cash costs up to about $2.10 per pound of copper from the July estimate of $2.00. However, BMO Capital Markets analyst Katja Jancic noted that realized copper prices exceeding $6.50 per pound should largely offset this deferred revenue. BMO estimates third-quarter adjusted earnings of $3.09 billion, beating the $3-billion analysts’ consensus.
Smelter Restarts and Broader Market Supply
Subsidiary PT Freeport Indonesia restarted its East Java smelter in late August following a temporary suspension tied to last year’s incident. Operating alongside the separately managed PT Smelting facility, the complex can process up to 800,000 tonnes of copper cathode annually, supported by a refinery capable of handling all of Grasberg’s gold output.
The 2025 closure of Grasberg removed an estimated 278,000 tonnes of copper from supply, representing roughly 1.2% of global mine output according to Benchmark Mineral Intelligence data cited by mining.com. While domestic U.S. operations faced localized flooding, power outages, and strong winds during the quarter, international outperformance balanced the consolidated results. BMO maintains an outperform rating on Freeport-McMoRan (NYSE: FCX) with an $85 price target, reflecting confidence in the ongoing recovery trajectory.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
