SG:Pan Pacific and Sumitomo won't buy copper from BHPB
Pan Pacific Copper Co and Sumitomo Metal Mining Co won’t purchase concentrate from BHP Billiton Ltd this year via an annual contract.
A senior executive who declined to be identified as the discussions were private said that Pan Pacific ended negotiations for an annual contract. Sumitomo Metal Mining spokesman Masashi Takahashi said it won’t purchase concentrate from BHP this year under an annual contract after failing to reach an agreement on processing fees.
Japanese smelters have struggled to secure 2012 fees with BHP after agreeing with Freeport-McMoRan Copper & Gold Inc. to charge USD 63.5 a metric tonne and 6.35 cents a pound, up from USD 56 and 5.6 cents in 2011. An increase in fees, known as treatment and refining charges, or TC/RCs, boosts smelters’ revenue.
Mr Takashi Murata an analyst at Daiwa Securities Capital Markets Co in Tokyo said that “This is a rare case for annual deals. The volume of concentrate this year with BHP may not be very significant or BHP’s offer may be less than Freeport’s.”
Ms Kelly Quirke a Melbourne based spokeswoman for BHP, declined to comment on individual contracts with companies.
