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China spot TC/RCs fall to USD 84 to USD 92 per tonne

Metal News - Published on Thu, 07 Dec 2017

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Platts reported that spot treatment and refining charges for Chinese smelters were at USD 84 to USD 92 per tonne and 8.4 to 9.2 cents/lb last week, edging down from USD 85 to USD 93 per tonne and 8.5 to 9.3 cents/lb the previous week, with thin imported concentrate trade amid annual term TC/RC talks.

Both Tongling Nonferrous Metals and Jiangxi Copper said in their December copper sector reports that the Chinese smelting sector and overseas mines could not finalize term TC/RCs for 2018 due to diverse views on next year's market fundamentals.

Jiangxi Copper said annual term TC/RCs in past years had been agreed around year-end, but the two sides have reached a stalemate this year because their views on supply and demand of mined copper next year are divergent. Key Chinese smelters have ample stocks of concentrate, so are not doing much buying.

Tongling Nonferrous said that due to the lack of agreement, term TC/RC talks for next year are expected to continue into early 2018.

Base metals and commodities platform owner China Construction Bank in its December copper report said the ongoing talks have led to thin buying of spot imported copper by China. Heightened concerns about mined copper supply risks, with strikes at mines in Chile and Peru, as well as increased copper prices have also hindered the talks.

TC/RCs, fees paid to smelters by mines to convert concentrate into refined copper, are a key source of revenue for smelters.

Data from the General Administration of Customs showed that China imported 1.37 million tonne of copper ores and concentrates in October, down 100,000 tonne month on month, but up 0.74% year on year. Over January to October, ore and concentrate imports rose 2.9% year on year to 13.93 million tonne.

China's mined copper demand is forecast to be 6.15 million in 2018, up 6% from an estimated 5.8 million mt this year, estimates by state-run metals consultancy Beijing Antaike showed.

The Agency said that China's net mined copper imports (25% metal contained in ores) are forecast to be 4.8 million tonne next year, up 6.7% from an estimated 4.5 million tonne this year, with domestic mined copper output seen at 1.72 million tonne next year, up 4.2% from an estimated 1.65 million tonne this year.

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Posted By : Rabi Wangkhem on Thu, 07 Dec 2017
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