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Sources: China smelter company decides to not set Q3 copper fee guidance

Sources said that China's leading copper smelters chose not to set guidance for an important copper processing charge during the third quarter. This is the second time they have done this in a row, as the industry struggles with a tight supply of concentrate.

Four sources who had knowledge of the issue but were not authorized to speak to the media said that the decision was taken at a meeting on Friday of the China Smelters Purchase Team. The CSPT is a group made up of China's sixteen largest smelters, who are expected to follow the guidelines in spot copper concentrat deals.

The decision reflects an exceptional tightness on the copper market. The fight to obtain ore has reverted the standard commercial logic, leading to a situation in which spot fees are in negative territory since December last year.

This means that smelters are paying miners for the ore they process, instead of doing it the other way round.

Chinese smelters reached an agreement with Antofagasta, a Chilean miner, to pay $0 per metric tonne and 0 cents a pound for treatment and processing. The negotiations took place at the mid-year point last month. Smelters saw the agreement to process concentrate at no cost as a victory. (Reporting and editing by Christian Schmollinger, Muralikumar Anantharaman and Amy Lv)

(source: Reuters)