BEIJING/HANOI : Global miners and Chinese smelters could set higher annual treatment and refining charges in 2023 as rising copper concentrate supply is expected to outpace smelting capacity growth.
"This raises the spectre of a smelter bottleneck for the first time in over a decade, where smelter utilisation is maxed out, forcing excess concentrate to be stockpiled or forced offline via economics," he added.This year the benchmark was set at $65 per tonne and 6.5 cents per pound, but China's top copper smelters already lifted their floor TC/RCs in the fourth quarter to a five-year high at $93/9.3c due to a supply glut.
Three sources in China saw the 2023 TC being set at $80-$90 a tonne, and another Chinese smelter source saw the TC rising above $100 a tonne. Pickens predicts benchmark TC/RCs to be 20 per cent-30 per cent higher than 2022, or around $78/7.8c to $84.5/8.45c. "We have Daye's new smelter ramping up very smoothly and existing Chinese smelters running at very high capacity to satisfy the domestic market which looks promising after the recent announcements from the Chinese government," a source at a miner said.