CESCO ASIA: Market views Codelco's China premium cut to $72/t as 'reasonable'

Chilean producer Codelco has cut the premium at which it will sell copper cathodes to Chinese customers in 2017 by 27% to $72 per tonne on top of LME cash prices, a level which traders and consumers view as "reasonable", sources told Metal Bulletin on the sideline of CESCO Asia in Shanghai.

Many have expressed that the number is reasonable and close to market conditions, while they expect Codelco to achieve a higher sales volumes under the long-term contracts compared with 2016.
Consumers in talks to increase long contract volumes 
"When we exchanged views in London, they were talking about $70-ish numbers, and now it's set at $72 [per tonne], which falls into that range," said a copper consumer.
Some consumers said they may struggle to obtain discounts from Codelco this year. Last year, some claimed to have secured a reduction on the long-term benchmark with Codelco of around $20 per tonne but the deals included Codelco's Standard STD brand, which has lower specifications than other brands.


Kiki Kang

Perrine Faye

Vicky Chen

November 14, 2016

08:55 GMT

London, Shanghai