Codelco, the Chilean state mining company, reported its lowest copper output in more than two decades following a mine collapse that disrupted recovery efforts from a prolonged production slump.

According to data released yesterday by Chilean copper agency Cochilco, Codelco produced 93,400 tonnes (t) in August, a 25% decrease from the same month last year.

The decline in production is attributed to an accident at the El Teniente mine on 31 July.

The earthquake-induced accident occurred near the Andesita section of the mine’s extensive underground tunnel network.

It resulted in six fatalities, nine injuries and a halt in activities for over a week, leading the company to adjust its annual output projection.

Codelco estimated that the collapse reduced production by approximately 33,000t.

Although operations have resumed in areas unaffected by the collapse, this incident, the worst in the Chilean industry in three decades, poses challenges to Codelco’s standing as the world’s largest copper producer, reported Bloomberg.

This adds to increasing supply-side risks in the global copper market amid rising demand from the energy transition and data centre construction.

In comparison, Escondida, operated by BHP Group, produced 105,100t in August. While this was lower than July’s output, it showed little change from the previous year, according to Cochilco data.

Escondida remains the world's largest copper mine. Meanwhile, the Collahuasi mine, jointly owned by Anglo American and Glencore, recorded a slight production increase from July. However, it remains below last year’s levels due to a period of lower-quality ore.