China smelters happy to take Codelco copper blend - source
By Anthony Esposito
SANTIAGO, April 22 (Reuters) - Chilean state-owned miner Codelco has not faced problems selling mixed impure and cleaner blends from its Ministro Hales mine to smelters in China, a source at the world's leading copper producer told Reuters on Wednesday.
Codelco has been blending the high-arsenic concentrate from Ministro Hales with cleaner grades to supply to smelters in China, where imports of material with more than 0.5 percent arsenic have been restricted.
Many market participants say blending is not a long-term solution as it has tightened the standard grade market. The spread in treatment and refining charges (TC/RC) has also widened sharply between standard grades and those with impurities.
Most of the world's smelters are unable to process hazardous materials.
Sources told Reuters last month that Chinese smelters had bought less of the blended concentrate than Codelco had expected, as the smelters bet on strong spot TC/RC charges.
A source at Codelco, however, said the smelters in China had been happy to take the blended concentrate.
"With Codelco's backing and guarantee it has not been a problem selling these blends and they have been very well received by the smelters," said the company source on Wednesday.
The roaster at Ministro Hales, which is used to remove arsenic from the ore, has been plagued by start-up issues. Codelco last week said it expects to have it fully operational in two to three months.
In recent days, the spread between dirty and clean copper concentrate has flared out dramatically, with high-arsenic material selling for as much as $180 per tonne, stirring the debate over the long-term impact of lower ore grades on global smelters. Standard grades go for about $110 per tonne and 10 cents per lb. (Reporting by Anthony Esposito, editing by G Crosse; Editing by Rosalba O'Brien)
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