Capstone Copper (ASX:CSC) Hits Record Production Despite Chile Strike: Is This Copper Giant a Buy?

Capstone Copper Achieves Record Production Despite Strike

Capstone Copper (ASX: CSC) jumped 7% to AU$15.63 on Friday after the company announced a record 2025 production of 224,764 tonnes of copper. This marks the fourth straight year of record output, with production up 22% from 2024 and 37% compared to 2023. The strong result was driven by the successful ramp-up of the US$870 million Mantoverde Development Project in Chile.

Q4 alone delivered 58,273 tonnes, a new quarterly record, while Mantoverde posted its best-ever monthly output of 10,747 tonnes in December. With a market cap of around AU$11 billion, Capstone Copper is now one of the larger copper producers listed on the ASX.

Yet the celebration comes with a catch. Union #2 at Mantoverde has been on strike since January 2, creating uncertainty for 2026. The question for investors is whether Capstone’s strong momentum can overcome the labour headwinds.

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Record Production Shows Capstone Can Deliver on Its Promises

Capstone Copper runs four mines: Mantoverde and Mantos Blancos in Chile, Pinto Valley in Arizona, and Cozamin in Mexico. In 2025, the company proved it could ramp up a major project while still delivering at its existing operations.

The Mantoverde Development Project, which started producing copper concentrate in mid-2024, is now running at full speed. This turned Mantoverde from a smaller oxide operation into a much bigger sulphide producer. December’s record output shows the project is working as planned. We believe this shows strong management skills, which matter a lot when looking at mining companies.

Mantos Blancos also hit record quarterly production in Q4. For investors, having four mines across three countries means less risk if one site has problems.

The Strike Risk Investors Should Watch Closely

While the production numbers look great, the ongoing strike at Mantoverde needs attention. Union #2, which represents about half of Mantoverde’s employees and 22% of the total site workforce, walked out on January 2 after pay talks failed.

Here’s the good news: Mantoverde has kept running at 50% to 75% of normal production during the strike. This is much better than the 30% the company first expected. Also, the three other unions at Mantoverde have already signed new three-year deals, which suggests this dispute may be limited to just one group.

However, if the strike drags on, it could hurt 2026 output. Investors should keep an eye on this over the coming weeks.

The Investor’s Takeaway for Capstone Copper

At AU$15.63, Capstone Copper trades on a forward PE ratio of around 17x, which looks fair for a company growing production at 22% per year. Analyst targets sit around AU$15.50, meaning the stock is trading roughly at fair value right now.

The growth pipeline adds appeal. The Santo Domingo copper project, located just 35 kilometres from Mantoverde, should reach a final investment decision in the second half of 2026. Orion Resource Partners has committed up to US$360 million for a 25% stake, which helps share the funding risk.

For growth-focused investors, Capstone Copper looks solid given its production track record and clear path to expansion. However, we suggest watching for strike resolution before adding big positions. If the dispute settles quickly, current prices could be a good entry point. If it drags on, waiting may get you a better price.

What to watch: Strike resolution, 2026 guidance, and Santo Domingo investment decision.