Smelters process Chilean concentrate for free

The mid-year negotiations between Antofagasta (AMSA) and Chinese smelters have concluded with a historic settlement of $0/0¢. While unprecedented, the outcome is not surprising, as it lands slightly above the midpoint of the believed negotiating range, from -$15/-1.5¢ proposed by Antofagasta +$10/1.0¢ from the Chinese smelters. Moreover, this result aligns with market participants’ rumours circulating prior to the agreement. Separately, rumours suggest Q3 contract negotiations between one top miner and Chinese smelters concluded at levels ranging from -$25/-2.5¢ to (+)$5/0.5¢.