SHANGHAI, Mar 23 (SMM) – Treatment charges for spot copper concentrate dropped last week, as fears of supply disruption grew after a slew of countries including major copper producers—Chile and Peru, put more stringent measures in place to contain the fast-spreading COVID-19 pandemic.
The SMM copper concentrate index, which assesses TCs for imported copper concentrate spot trades in China, stood at $68.35/mt for the week ended March 20, down $3.12/mt from a one-year peak of $71.47/mt in the prior week.
The markets were concerns about potential delays of copper concentrate shipments scheduled for delivery in April, as copper mines in South America scaled back operations after the governments declared a state of emergency amid the pandemic outbreak. Growing demand added to fears of supply shortages, on the back of production recovery at Chinese smelters.
Trading activity eased last week, as supply concerns prompted sellers to sharply slow sales.
Antofagasta said on Friday it would put parts of its Los Pelambres expansion project in Chile on care and maintenance as it reduced the number of staff to reduce risk of coronavirus infection.
Codelco, Chile's largest copper producer, said last Thursday that it has reduced operations in compliance with orders from Chile's government to "maintain operational continuity" for a period of 15 days.
On the same day, Chinese miner MMG said that operations at its Las Bambas mine, one of the biggest copper mines in Peru, had been reduced temporarily, while Anglo American said it is scaling down operations at its Los Bronces copper mine in Chile after the company said on Tuesday that it will slow the building of its Quellaveco project in Peru.
Teck Resources said on Wednesday it is temporarily suspending construction activities at its Quebrada Blanca Phase 2 copper project in Chile.
Earlier in the week, Freeport-McMoRan announced that it has put its Cerro Verde copper mine in Peru on care and maintenance for 15 days in response to virus containment measures taken by the Peruvian government.
Rio Tinto said on Monday that work at its Oyu Tolgoi copper-gold mine in Mongolia has slowed because of government curbs to curtail the spread of a coronavirus. The mining giant temporarily halted operations at its Kennecott copper mine in Utah, US, after a magnitude 5.7 earthquake struck near the town of Magna on Wednesday.
Brazilian miner Vale said on Monday that it is reducing activity and output at its Voisey Bay copper mine in Canada as a precaution to protect nearby indigenous communities from coronavirus.
Pan American Silver has also temporarily suspended operations at its four mines in Peru – Shahuindo, La Arena, Huaron and Morococha, in accordance with government-mandated restrictions in response to the virus.
BHP said so far the pandemic has not affected output. A Reuters report Wednesday last week said unionized workers at BHP’s Escondida mine in Chile requested a halt to operations unless management begins to implement stricter health and safety measures.
Polish state-run firm KGHM, one of the world’s biggest copper and silver producers also said so far the pandemic has not affected its output and sales. But it will consider asking the state for support if needed, the company added.