China’s copper smelters raise floor treatment, refining charges to five-year high amid rising concentrate supply
COMMODITIES
China’s copper smelters raise floor treatment, refining charges to five-year high amid rising concentrate supply
COMMODITIES

China’s copper smelters raise floor treatment, refining charges to five-year high amid rising concentrate supply

 

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China’s leading copper smelters hiked their floor treatment and refining charges (TC/RCs) for the fourth quarter of 2022 to the highest in five years as rising concentrate supply is expected to outpace the expansion in smelting capacity.

The floor charges of $93 per tonne and 9.3 cents per pound were set by the China Smelters Purchase Team (CSPT) at an online meeting on Tuesday, industry insiders say.

That’s higher than the $80 per tonne and 8 cents per pound set for the third quarter of 2022, and up from $70 per tonne and 7 cents per pound for the fourth quarter of 2021.

Miners pay TC/RCs to smelters to process copper concentrate into refined metal, offsetting the cost of the ore. The charges fall when supply tightens and rise when more concentrate is available. The members of the CSPT in top copper consumer China, including Jiangxi Copper, Tongling Nonferrous and China Copper, are meant to adhere to the floor when agreeing spot processing deals for imported concentrate.

As COVID restrictions that had constrained mining operations in 2021 were relaxed this year, global copper mine production climb 1.3% in the first half of 2022 from a year earlier to 10.63 million tonnes, according to data released by the World Bureau of Metal Statistics. Global copper mine production is expected to reach a total of 22.25 million tonnes this year, rising 5.1% from a year earlier, forecast International Copper Study Group (ICSG).