* Freeport to pay 31 pct more in 2014 TC/RCs to Pan Pacific
* Agreed TC/RC of $92/T, 9.2 cents/lb is Pan Pacific's
highest since 2006
By Yuka Obayashi
TOKYO, Nov 21 Pan Pacific Copper, Japan's
biggest smelter, won its highest copper processing fees in eight
years in a deal with U.S. miner Freeport-McMoRan Copper & Gold
Inc, reflecting an anticipated growth in mine supply.
The treatment and refining charges (TC/RCs) for Freeport
were set at $92 per tonne and 9.2 cents per pound respectively,
up 31 percent from $70 and 7 cents for 2013, a Pan Pacific
spokesman said on Thursday.
The charges are similar to what Freeport has agreed to pay
to smelters in top copper consumer China.
Miners pay TC/RCs to smelters to convert concentrate into
refined metal, with charges deducted from the sale price. The
charges typically rise when supply increases.
The agreed TC/RCs with Freeport marks the highest for Pan
Pacific since $95/T, 9.5 cents/lb in 2006, the spokesman said.
They also come above $80/T and 8 cents/lb offered by
Anglo-Australian miner BHP Billiton to Japanese
copper smelters earlier this month.
Higher fees will likely help improve earnings of Pan
Pacific, the world's third-biggest copper smelter, and its
parent JX Holdings Inc which forecast a 6 percent
year-on-year drop in net profit for the year ending March 2014.
Pan Pacific has said that it was aiming to raise the
processing fees it charges sellers of raw material concentrate
in 2014 by more than 35 percent to $95/T, 9.5 cents/lb as it
cashes in on rising mine supply.
It will continue talks with other global miners with an aim
to sign agreements by Christmas.
Other Japanese smelters such as Sumitomo Metal Mining Co Ltd
and Mitsubishi Materials Corp declined to
comment on the fee negotiations.
Hiroshi Yao, chairman of Japan Mining Industry Association
(JMIA) and president of Mitsubishi Materials, told reporters on
Thursday: "I can't comment on details of the TC/RCs
negotiations, but the fees will be reflecting the recent and
expected trend of rising ore supply."