Aug. 2 (Bloomberg) -- Chile, the world's biggest copper producer, had the highest level of business confidence in five months in July after miners said their production rose, a survey published by the central bank showed.

The monthly indicator rose 1.96 points to 61.66 from 59.71 in June and from 57.55 in July 2004, according to a survey of 524 companies published today on the Santiago-based bank's Web site. The indicator among miners rose to 82.88 from 65.62 in June, the highest level since the survey began in November 2003.

Miners, which are working near full capacity, may expect a small decline in copper prices in the months ahead, the survey said. Prices for copper, Chile's largest export, are near record levels because of greater sales in China, the biggest user of the metal worldwide. That demand has sparked investment by miners to boost production, Juan Villarzu, executive president of Codelco, the world's biggest copper producer, said.

``Big companies all are actively working to open mines and to develop new projects,'' Villarzu said in a speech in Santiago yesterday.

Copper futures for September delivery rose 0.4 cent, or 0.2 percent, to $1.6670 a pound at 11:21 a.m. on the Comex division of the New York Mercantile Exchange, the highest ever.

Perception

Miners said their outlook for sales improved in July from a month earlier while their perception of current demand weakened, the survey said. Miners also expect higher costs, the survey showed. Chile accounts for about a third of copper from mines worldwide.

The three other industries tracked by the survey, retailing, construction and manufacturing, all had declines in their indicators of business confidence from the earlier month. They also had an indicator higher than 50, showing confidence about the outlook for the economy.

Adolfo Ibanez University and the Chilean Institute of Rational Administration of Companies don't name the companies in the survey. Businesses also respond to questions on inventories, salaries, employment and the economy.

Companies usually answer the surveys within the first 20 days of each month, according to the Chilean Institute.

To contact the reporter on this story: Heather Walsh in Santiago at hlwalsh@bloomberg.net

Last Updated: August 2, 2005 11:25 EDT