Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

China’s copper smelters have lowered refining/treatment charges (RC/TC) for Q3 2021 by $4.5/mt to a minimum of $55/mt or 5.5¢/lb. 


According to media reports, government-backed market participants of the China Smelters Purchase Team (CSPT) decided on the new RC/TCs at a meeting in Tongling, China. 


These charges form the basis of revenue for smelters such as China Copper, Jiangxi Copper, Tongling Nonferrous, and Jinchuan Group that refine copper ore, cathodes, and similar products. 


All CSPT members are expected to meet the quarterly floor rate in any concentrate deals made in the spot market from miners such as Freeport and Codelco in the third quarter. 


In Q1 2021, the RC/TC rate was set by the CSPT at $59.5/mt. The team had predicted a lower floor of $53.5/mt for the third quarter after Freeport indicated a market rate of $53/mt in early April. 


However, copper prices rose exponentially in May, with LME copper cash contracts consistently remaining above the $10,000/mt mark through most of the month, before it corrected down to the current levels of $9,430/mt over the past two weeks.



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