Jiangxi Copper Reach Agreement with Freeport for 2010 TC/RCs

 SHANGHAI, Jan. 7 (SMM) –One person familiar with the situation said on January 4th that Jiangxi Copper Company has reached a deal with Freeport McMoRan for 2010 copper concentrate TC/RCs, with levels at USD 46.5/mt (cents 4.65/lbs).  The person noted Jiangxi Copper Company signed the agreement with Freeport at USD 46.5/mt (cents 4.65/lbs), since the fees had become a benchmark for the industry.

SMM contacted several domestic copper smelters concerning the fees, and they believed that the price level was acceptable for them, though it was lower than expected.  A senior official from one domestic medium-size copper smelters told SMM that the negotiation with major overseas ore suppliers is still underway, and ore suppliers reported unwillingness to sign a contract at USD 46.5/mt (cents 4.65/lbs) for TC/RCs, and so possibility exists that the settlement may be lower the level.

SMM believes soaring copper prices in recent days, rebounding sulfuric acid prices, as well as expanding output have placed domestic copper smelters into an unfavorable position in the TC/RC negotiations.  If overseas ore suppliers insist to set low offers, the price level of USD 46.5/mt (cents 4.65/lbs) will likely become the high-end of TC/RC for 2010 copper concentrate.  

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