July 17 (Bloomberg) -- The cost of treating and refining copper ore rose in the past month amid increased supplies from mines, according to Aurubis AG, the world’s second-biggest producer of refined metal.
Spot fees are now “well above” $80 a metric ton to treat concentrate and 8 cents a pound to refine metal, Michaela Hessling, a spokeswoman for the Hamburg-based company, said today by e-mail. That compares with levels of about $70 and 7 cents last month, she said.
Processing costs increase when ore supplies expand or smelting capacity shrinks. Smelter closings for scheduled maintenance also helped to lift the fees by reducing demand for concentrate, partly processed ore that’s shipped from mines, according to Hessling.
Concentrate production will expand 2.6 percent to 17.1 million tons this year, Morgan Stanley said this month in a report. That will exceed demand by 53,300 tons, the bank said.
Rio Tinto Group made the first commercial copper shipment this month from its Oyu Tolgoi mine in Mongolia and said yesterday second-quarter production of mined copper gained 10 percent in annual terms. Freeport-McMoRan Copper & Gold Inc. resumed concentrate deliveries from Grasberg in Indonesia, where a fatal accident in May interrupted activity.
Aurubis has said it will shut its Hamburg smelter as early as September for seven weeks, reducing treating by 150,000 tons. Boliden AB, a Swedish producer of industrial metals, closed smelters including its Roennskaer copper plant for maintenance last quarter. KGHM Polska Miedz SA said last week its Glogow smelter would close July 14 for three months.
Aurubis produces about 1 million tons a year of cathode, a refined form of copper, from both scrap metal and concentrate, according to the company’s website.
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