Antofagasta Completed Negotiations Over TCs Under Long-Term Contracts, Shipments From Peruvian Port Were Postponed

The SMM Copper Concentrate Index in May rose by $4.49/mt on the month to $87.87/mt. The SMM Imported Copper Concentrate Index (weekly) for the week ending June 9 was $89.93/mt.

The copper concentrate spot market transactions in May were subdued. Traders' spot offers were quite ample, and there was an oversupply. Mines and smelters struck deals for TCs of clean copper concentrates at around $85/mt for shipment in July, compared to $75-79/mt between mines and traders. Some smelters purchased 10,000 mt of copper concentrates from Los Bronces for loading in July at close to $90/mt. But the shipments were delayed due to "port reconstruction" issues. According to the SMM survey, the spot trading of copper concentrate picked up in early June. One smelter purchased 20,000 mt of clean seaborne ore scheduled for shipment in August and the fourth quarter of this year with TCs of $90/mt, and another smelter purchased copper concentrate from Buenavista mine in Mexico with TCs of over $88/mt, which was loaded in April. TCs for clean ore scheduled for the third quarter between a mine and a smelter rose above $85/mt.

Antofagasta completed negotiations on TCs under long-term contracts between July 2023 and June 2024 with South Korean LS-MnM smelter in early June, which focused mainly on the supply and demand balance of global copper concentrate in the next two years. The second round of negotiations between Antofagasta and some smelters in China will start in mid-June. In early June, offers of Antofagasta to some Chinese smelters were $81-82/mt, while the benchmark of some Chinese smelters was above $88/mt.

According to SMM survey, the port of Ventanas in Chile announced in late May that Ventanas port will carry out "port reconstruction" work in June, which will cause the original grab equipment to be out of service for 10-15 days in June. The shipments of Bronces copper mine were delayed due to the impact of "port reconstruction", strong winds and waves at the port, ships queuing up to berth, and high water content in copper concentrate. In addition, the copper concentrate shipping belt damaged by the port fire at the end of 2022 is expected to be installed and put into operation in August-September at the earliest.

The "Peruvian Armed Protection Period" of Las Bambas copper mine will "expire" at the end of June or early July. By then, community road blockages and strikes may recur, and the disruptions to the production at Peruvian copper mines are expected to increase again.