Copper concentrate Supply continued to recover

As of Friday March 17, the SMM Imported Copper Concentrate Index (weekly) stood at $75.58/mt, $0.71/mt lower than March 10. During the week, copper concentrate spot transactions were quite active. There were multiple spot transactions of clean ore between mines and smelters with TCs of $73-74/mt, scheduled for shipment mostly in May and the second quarter. Traders quoted at $73-74/mt for clean ore scheduled for shipment in the second quarter, while smelters' inquiries for clean ore to be shipped in the same period exceeded $78/mt. Currently, most smelters in the market have a strong wait-and-see attitude towards future TCs, and expect TCs to rebound in April. Some smelters also need to restock clean ore that are slated to arrive in April. The pricing coefficient of domestic spot Cu 20% copper concentrate was 88.5%-89.5%.  

On March 13, 2023, MMG welcomed the removal of a roadblock in the Velille district of Peru that impeded logistics and transportation. Concentrate transportation was resumed on March 11, 2023 (Peru time), and the mine is resuming full production. After resuming concentrate transportation, Las Bambas will gradually reduce the inventory of copper concentrate ores in the mine. MMG continued to work closely with communities along the Southern Corridor to reach long-term agreements on maintaining supply and export logistics. According to SMM research, in January 2023, the output of Las Bambas copper concentrate even hit a monthly production record. The Las Bambas mining area set aside a new yard area for storing copper concentrates. Currently, Las Bambas can transport up to 20,000 mt of copper concentrates to Matarani Port by truck in two days. Although the land transportation logistics is smooth, the mine still faces port congestion and scarcity of ships. Currently, copper concentrates have to be stacked at the wharf for shipment. It is expected that some of Las Bambas’s copper concentrates will be shipped in late March. On March 10, 2023, the Panama Maritime Administration lifted the ban on the suspension of First Quantum Minerals' operations at Punta Rincon port, where First Quantum Minerals could ship Cobre Panama copper concentrate.

Chinese smelters, including China Daye Non-Ferrous Metals Mining’s Headquarters, Jiangxi Copper, Tongling Jinguan, and Qinghai Copper, will undertake maintenance in April. Meanwhile, port capacity in South America will continue to recover. The production at overseas mines has topped expectations, and Quebrada Blanca Phase 2 in Chile will be commissioning soon. SMM thus expects spot TCs to rise at the beginning of the second quarter. According to SMM statistics, the inventory of copper concentrate at five Chinese ports was 743,000 mt in the week ending March 17, a drop of 31,000 mt from a week earlier.