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Can Southern Copper's Mexican Projects Drive Long-Term Growth?
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Key Takeaways
Southern Copper plans to advance $10.2B in Mexican investments to support long-term growth.
El Pilar construction is set for 2027, with 36,000 tons of copper cathode targeted in 2029.
Southern Copper targets 1.056M tons of production in 2029 and 1.6M tons by 2035.
Southern Copper Corporation (SCCO - Free Report) is in discussions with the administration to advance its investments of $10.2 billion in Mexico. The company has a strong Mexican pipeline, which is expected to boost organic growth in the coming years.
Southern Copper’s Mexican copper circuit, which includes Angangueo and Chalchihuites mines, along with the Empalme Smelter, is expected to position the company as a fully integrated copper producer.
The company expects construction to commence in the first quarter of 2027 at its new El Pilar copper project in Sonora, with production slated to begin in the second half of 2029. El Pilar’s copper oxide mineralization contains estimated proven and probable reserves of 317 million tons of ore. The mine has an expected life of 18 years. Southern Copper expects El Pilar to produce 36,000 tons of copper cathode in 2029.
SCCO’s El Arco mine in Baja California is a world-class copper deposit with more than 1,230 million tons in sulfide ore reserves and 141 million tons of leach material. El Arco mine is expected to produce 190,000 ounces of copper in 2030.
Southern Copper maintains a strong long-term outlook, with production expected to reach 1.056 million tons in 2029 and targets 1.6 million tons by 2035. The breadth of these projects gives Southern Copper multiple sources of organic production growth beyond current mine grades. Tía María, Los Chancas and Michiquillay in Peru, along with El Pilar, El Arco and other projects in Mexico, will aid the company’s production in the upcoming years.
Growth Drivers of Southern Copper Peers
Teck Resources Ltd. (TECK - Free Report) continues to advance projects toward sanction readiness while prioritizing Quebrada Blanca and the Highland Valley Copper Mine Life Extension. Highland Valley construction progressed in the second quarter of 2026, with detailed engineering about 95% complete and procurement nearly complete. The project is expected to extend mine life to 2046 and support average annual copper production of about 132,000 tons.
Quebrada Blanca produced 55,800 tons of copper in the second quarter of 2026, up from 52,700 tons a year earlier and broadly stable with the first quarter. The operation completed a third consecutive quarter of stable performance. Teck Resources maintains its 2026 copper production guidance of 455-530 thousand tons, whereas it produced 453.5 thousand tons in 2025. This will be driven by higher output at QB, Highland Valley Copper and Antamina. Teck Resources’ long-term outlook for copper is positive as demand is expected to grow, partly driven by electric vehicles, renewable energy and infrastructure investments.
Freeport-McMoRan Inc. (FCX - Free Report) is conducting exploration activities near its existing mines with a focus on opportunities to expand reserves. At Cerro Verde, a large-scale concentrator expansion provided incremental annual production of around 600 million pounds of copper and 15 million pounds of molybdenum.
Freeport-McMoRan is evaluating a large-scale expansion at El Abra in Chile to define a large sulfide resource that could potentially support a major mill project. The expansion is expected to result in the addition of more than 700 million pounds of copper production annually. Freeport-McMoRan, in April 2026, lowered its consolidated sales volume projections for 2026 to 3.1 billion pounds of copper from the prior view of 3.4 billion pounds due to an expected delay in achieving full ramp-up of the Grasberg Block Cave mine.
SCCO’s Price Performance, Valuations & Estimates
Southern Copper shares have surged 67.4% year to date compared with the Zacks Mining - Non Ferrous industry’s rise of 57.3%. During this time, the Basic Materials sector has risen 17.1% and the S&P 500 has rallied 17.3%.
Image Source: Zacks Investment Research
The Southern Copper stock is currently trading at a forward 12-month earnings multiple of 26.92X, which is a premium to the industry average of 22.82X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Southern Copper’s 2026 sales is $17.36 billion, indicating a 29% year-over-year jump. The consensus mark for the year’s earnings is pegged at $7.83 per share, suggesting a rally of 49%.
The Zacks Consensus Estimate for 2027 sales implies a 49.4% year-over-year dip. The same for earnings suggests a fall of 5.2%.
Earnings estimates for 2026 and 2027 have moved up over the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
Can Southern Copper's Mexican Projects Drive Long-Term Growth?
Key Takeaways
Southern Copper Corporation (SCCO - Free Report) is in discussions with the administration to advance its investments of $10.2 billion in Mexico. The company has a strong Mexican pipeline, which is expected to boost organic growth in the coming years.
Southern Copper’s Mexican copper circuit, which includes Angangueo and Chalchihuites mines, along with the Empalme Smelter, is expected to position the company as a fully integrated copper producer.
The company expects construction to commence in the first quarter of 2027 at its new El Pilar copper project in Sonora, with production slated to begin in the second half of 2029. El Pilar’s copper oxide mineralization contains estimated proven and probable reserves of 317 million tons of ore. The mine has an expected life of 18 years. Southern Copper expects El Pilar to produce 36,000 tons of copper cathode in 2029.
SCCO’s El Arco mine in Baja California is a world-class copper deposit with more than 1,230 million tons in sulfide ore reserves and 141 million tons of leach material. El Arco mine is expected to produce 190,000 ounces of copper in 2030.
Southern Copper maintains a strong long-term outlook, with production expected to reach 1.056 million tons in 2029 and targets 1.6 million tons by 2035. The breadth of these projects gives Southern Copper multiple sources of organic production growth beyond current mine grades. Tía María, Los Chancas and Michiquillay in Peru, along with El Pilar, El Arco and other projects in Mexico, will aid the company’s production in the upcoming years.
Growth Drivers of Southern Copper Peers
Teck Resources Ltd. (TECK - Free Report) continues to advance projects toward sanction readiness while prioritizing Quebrada Blanca and the Highland Valley Copper Mine Life Extension. Highland Valley construction progressed in the second quarter of 2026, with detailed engineering about 95% complete and procurement nearly complete. The project is expected to extend mine life to 2046 and support average annual copper production of about 132,000 tons.
Quebrada Blanca produced 55,800 tons of copper in the second quarter of 2026, up from 52,700 tons a year earlier and broadly stable with the first quarter. The operation completed a third consecutive quarter of stable performance. Teck Resources maintains its 2026 copper production guidance of 455-530 thousand tons, whereas it produced 453.5 thousand tons in 2025. This will be driven by higher output at QB, Highland Valley Copper and Antamina. Teck Resources’ long-term outlook for copper is positive as demand is expected to grow, partly driven by electric vehicles, renewable energy and infrastructure investments.
Freeport-McMoRan Inc. (FCX - Free Report) is conducting exploration activities near its existing mines with a focus on opportunities to expand reserves. At Cerro Verde, a large-scale concentrator expansion provided incremental annual production of around 600 million pounds of copper and 15 million pounds of molybdenum.
Freeport-McMoRan is evaluating a large-scale expansion at El Abra in Chile to define a large sulfide resource that could potentially support a major mill project. The expansion is expected to result in the addition of more than 700 million pounds of copper production annually. Freeport-McMoRan, in April 2026, lowered its consolidated sales volume projections for 2026 to 3.1 billion pounds of copper from the prior view of 3.4 billion pounds due to an expected delay in achieving full ramp-up of the Grasberg Block Cave mine.
SCCO’s Price Performance, Valuations & Estimates
Southern Copper shares have surged 67.4% year to date compared with the Zacks Mining - Non Ferrous industry’s rise of 57.3%. During this time, the Basic Materials sector has risen 17.1% and the S&P 500 has rallied 17.3%.
The Southern Copper stock is currently trading at a forward 12-month earnings multiple of 26.92X, which is a premium to the industry average of 22.82X.
The Zacks Consensus Estimate for Southern Copper’s 2026 sales is $17.36 billion, indicating a 29% year-over-year jump. The consensus mark for the year’s earnings is pegged at $7.83 per share, suggesting a rally of 49%.
The Zacks Consensus Estimate for 2027 sales implies a 49.4% year-over-year dip. The same for earnings suggests a fall of 5.2%.
Earnings estimates for 2026 and 2027 have moved up over the past 60 days.
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.