BEIJING - China's top two copper smelters clinched copper concentrate supply deals with miner Antofagasta for the first half of 2021, two sources with direct knowledge of the matter said on Thursday.

Jiangxi Copper and Tongling Nonferrous signed agreements to take concentrate, or partially processed copper ore, from the Chilean miner after a recent round of talks, the sources said.

Miners pay treatment and refining charges (TC/RCs) to smelters to turn ore into refined metal and the agreed rate plays a big role in determining the profitability of both sides.

TC/RCs go down when supplies of copper concentrate tighten.

One of the sources said the TC was $60.8 per tonne. The other source declined to comment on the rate, citing confidentiality.

Fastmarkets first reported the deals.

Antofagasta declined to comment. Jiangxi Copper and Tongling did not immediately respond to requests for comment.

It is the second year in a row Jiangxi and Tongling have moved early to secure supply from Antofagasta for the following year after inking deals with TCs around the mid-$60s 12 months ago.

Spot TCs in China AM-CN-CUCONC are currently languishing at $54.50 a tonne, the lowest since September 2012, according to an assessment by Asian Metal.

Smelters are keen to lock in supply in advance amid rising competition for concentrate as processing capacity expands, especially with the risk of supply disruptions rising in South America due to the coronavirus.

News of the deals also comes a day before China's copper smelters meet to decide floor treatment charges for spot concentrate deals in the third quarter.

 

(Reporting by Tom Daly in Beijing and Zandi Shabalala in London; Editing by Elaine Hardcastle and Emelia Sithole-Matarise) ((zandi.shabalala@tr.com;))