FCX vs. SCCO: Which Copper Mining Giant Should You Bet on Now?

By Anindya Barman | February 24, 2026, 7:12 AM

Freeport-McMoRan Inc. FCX and Southern Copper Corporation SCCO are two heavyweights in the copper mining industry. Both operate on a global scale, extracting and processing copper and other metals. Also, both are navigating fluctuating copper prices and global economic uncertainties.

Prices of copper, the backbone of electrification, were volatile yet mostly favorable in 2025 due to global economic and trade uncertainties. Copper prices started 2026 on a strong note, underpinned by robust demand from China and the United States. Structural tailwinds, including electric vehicles (EVs), renewable energy projects, data-center growth and grid modernization, continue to boost copper consumption.

Worries about tightening supply amid rising EV and infrastructure demand are supporting the red metal. Supply risks have also grown amid worries over lower output and potential disruptions at major global mining operations. Prices of the red metal are currently hovering near $6 per pound.

Let’s dive deep and closely compare the fundamentals of these two copper mining companies to determine which one is a better investment now.

The Case for Freeport

Freeport is well-placed with high-quality copper assets and remains focused on strong execution and advancing its organic growth opportunities. At its Cerro Verde operation in Peru, a large-scale concentrator expansion provided incremental annual production of around 600 million pounds of copper and 15 million pounds of molybdenum. It has completed the evaluation of a large-scale expansion at El Abra in Chile to define a large sulfide resource that could potentially support a major mill project similar to the large-scale concentrator at Cerro Verde, with an estimated resource of approximately 20 billion recoverable pounds of copper.

FCX is also advancing pre-feasibility studies (expected to be completed in 2026) in the Safford/Lone Star operations in Arizona to define a significant sulfide expansion opportunity. It has expansion opportunities at Bagdad in Arizona to more than double the concentrator capacity of the operation. Technical and economic studies have revealed the potential to build concentrating facilities to boost copper production by 200-250 million pounds annually.

PT Freeport Indonesia (PT-FI) substantially completed the construction of the new greenfield smelter in Eastern Java during 2024, with the start-up of operations having commenced in the second quarter of 2025. The first production of copper anode was achieved in July 2025. PT-FI is also developing the Kucing Liar ore body within the Grasberg district with a targeted ramp-up to commence in 2030. FCX completed studies in 2025 that showed an opportunity to increase Kucing Liar’s design capacity to 130,000 metric tons of ore per day and reserves by roughly 20% at low costs. Gold production also started at the new precious metals refinery in late 2024.

FCX has a strong liquidity position and generates substantial cash flows, which allow it to finance its growth projects, pay down debt and drive shareholder value. It generated solid operating cash flows of around $5.6 billion in 2025, including $693 million in the fourth quarter. Freeport ended 2025 with strong liquidity, including roughly $3.8 billion in cash and cash equivalents, $3 billion in availability under the FCX revolving credit facility, and $1.5 billion in availability under the PT-FI credit facility.

At the end of 2025, Freeport had a net debt of $2.3 billion, excluding PTFI’s new downstream processing facilities. Its net debt is below its targeted range of $3-$4 billion. Freeport has a policy of distributing 50% of the available cash to its shareholders and the balance to either reduce debt or invest in growth projects. FCX has no significant debt maturities until 2027.

FCX offers a dividend yield of roughly 0.5% at the current stock price. Its payout ratio is 17% (a ratio below 60% is a good indicator that the dividend will be sustainable). Backed by strong financial health, the company's dividend is perceived to be safe and reliable.

Despite these positives, Freeport faces headwinds from higher costs. FCX saw a sharp increase in its average unit net cash cost per pound of copper in the fourth quarter of 2025 to $2.22 from $1.40 in the prior quarter, marking a roughly 59% spike. It also climbed 34% year over year. The increase was fueled by a decline in copper sales volumes. Freeport's outlook for the first quarter of 2026 suggests higher costs on a sequential basis. It expects unit net cash costs to rise to $2.60 per pound, while projecting a full-year average of roughly $1.75. Lower expected sales volumes are likely to impact costs in the quarter. Higher costs are expected to weigh on the company's margins.

Freeport’s copper sales volumes tumbled approximately 29% year over year in the fourth quarter to 709 million pounds, and fell from 977 million pounds in the prior quarter. The company sold 80,000 ounces of gold in the fourth quarter, down around 77% year over year. The downside primarily resulted from the temporary suspension of operations since the mud rush incident at the Grasberg Block Cave mine in Indonesia in September 2025, which led to the suspension of operations.

Freeport’s outlook for copper sales volumes for the first quarter of 2026 assumes minimal contribution from its Indonesian operations due to the Grasberg mine incident. FCX expects copper sales volumes of 640 million pounds, indicating a 10% sequential and 27% year-over-year decline. The company has issued weaker guidance for gold sales volume of 60,000 ounces, suggesting sequential and year-over-year decreases. Lower sales volumes are expected to weigh on its top line in the first quarter. FCX remains on track to start a phased restart of the Grasberg Block Cave underground mine beginning in second-quarter 2026.

The Case for Southern Copper

Southern Copper has a strong pipeline of world-class copper greenfield projects and other promising opportunities. It operates high-quality assets in investment-grade countries such as Mexico and Peru. Backed by its constant commitment to increasing low-cost production and growth investments, the company is well poised to continue delivering enhanced performance.

The company continues to build its presence in Peru as the country is the second-largest producer of copper. Peru holds about 9% of the world’s copper reserves. Despite the near-term production headwinds, Southern Copper expects to ramp up its copper production to around 1.6 million tons by 2033. To support this expansion, the company plans to invest more than $20.5 billion over the next decade, with $10.3 billion earmarked for Peru.

The long-awaited Tia Maria project, located in Arequipa, Peru, with an annual capacity of 120,000 tons of SX- EW copper cathodes, is expected to start in 2027. In Mexico, the El Pilar project (expected to start in 2029) will contribute around 36,000 tons of copper cathodes annually. This project will use highly cost-efficient and environmentally friendly SX-EW technology.

By 2030, El Arco in Mexico is expected to become online and add 190,000 tons of copper. Peru’s Los Chancas project is slated to add 130,000 tons of copper starting in 2031. This will be followed by Michiquillay in 2032, adding an expected 225,000 tons of copper. It is projected to become one of Peru's largest copper mines with an expected mine life of more than 25 years.

SCCO holds the largest copper reserves among listed peers, totaling 51.1 million metric tons. Its low-cost, integrated operations and deep pipeline of world-class greenfield projects further strengthen its competitive positioning. The company is well-positioned to capitalize on the expected surge in copper demand in the year to come, backed by the energy transition trend.

SCCO generated net cash from operating activities of $4.75 billion in 2025, up roughly 7.5% from $4.42 billion in 2024, attributable to higher net income. Net cash from operating activities was around $1.49 billion in the fourth quarter of 2025, up from $1.36 billion in the prior-year quarter, driven by strong cash generation in its operations. SCCO offers a dividend yield of 2% at the current stock price. Its payout ratio is 68%, with a five-year annualized dividend growth rate of roughly -1.6%.

However, SCCO faces headwinds from near-term production declines. For 2025, copper production decreased 1.8% to 956,270 tons, which came in 1% lower than the company’s expected 965,000 tons. Lower output at Buenavista and the Peruvian mines, partially offset by a rise in production at IMMSA and La Caridad mines, led to lower output. Expecting lower ore grades at its Peruvian operations, the company expects copper production at 911,400 tons in 2026, implying a decrease of 4.7% from 2025. Lower production is expected to weigh on its performance.

FCX & SCCO: Price Performance, Valuation & Other Comparisons

FCX stock has gained 76.9% over a year, while SCCO stock has rallied 122.9% compared with the Zacks Mining - Non Ferrous industry’s rise of 92.6%.