Cable network

Codelco, the world's largest copper miner, has offered Chinese customers annual copper supplies for 2022 at a premium of $105 a tonne, two sources familiar with the matter said on Monday.  

Exhibition

The premium, up 19.3 per cent from $88 a tonne this year, is paid on top of the London Metal Exchange price for physical delivery of cathode copper to China, the world's biggest copper consumer, a widely watched industry benchmark.  

Group photo of cooperative customers

The higher premium continues a trend of higher premiums next year due to strong copper demand and very low inventories.  

Codelco's bid for 2022 was made available to Chinese customers, including some state-owned enterprises, on Monday, said the sources, who declined to be named because the information is not public.  

Codelco, which was not immediately available for comment, last month offered European customers a premium of $128 a ton for next year, the highest since 2015 and up more than 20 percent from 2021.  

It then offered south Korean customers a premium of $100 a tonne for 2022, also up about 20% from a year earlier.  

Customer visit to China

Codelco's offer in China is higher than the current Yangshan premium -- $98 a tonne above the LME price for copper imported through the Yangshan Bonded Warehouse -- according to an assessment by MM, an industry pricing and information provider.  

Codelco allows Chinese customers to buy half of its contracted annual supply at a backwardation rate.  Its premium in China has been $88 a tonne since 2019.