The Metal Bulletin copper concentrates index dropped by 3% to $69.50 per tonne/6.95 cents per lb from $71.60/7.16 cents at the end of January.

Several mines sold concentrates to traders in tenders and private deals, while reported deals for nearby tonnage differed greatly, ranging from the mid-$50s to high $60s.

“March-April is already getting tight and expectation from the trade is that the market will get tighter further out,” one trader said.

Lowball bids on concentrate parcels by traders have been helped in part by improving spreads for the red metal – no longer plagued by frequent backwardations of prior years.

The contango is also widening the spread between where miners are selling to traders and smelters; with the latter resolute at higher TC/RC levels.

Buying interest from smelters have slowed down ahead of the Chinese New Year holiday (February 15-21). Large smelters are for the most part absent from the spot market or holding out for more favorable terms as the year progresses.

Smelters are mainly bidding around $80/8 cents, while traders are keeping their offers at the mid-to-high $70s, market participants said.

Three cif China 10,000-tonne smelter deals were captured by Metal Bulletin, bought by medium and small-size smelters. The deals were concluded at $78/7.8 cents, $76/7.6 cents and $75/7.5 cents respectively.

Demand for concentrates is stable after smelters, such as Glencore’s Pasar and Birlas Dahej, came back on stream, and Chinese smelter Jinchuan announced it is halting 200,000 tonnes of copper refining capacity at its Gansu plant.

Yet uncertainty over supply is still pervasive, with the market gearing up for major union discussions in March. Metal Bulletin is monitoring the key labor contract negotiations this year.

“A few union negotiations came and went without a fuss,” one smelter said. “Obviously the big ones are starting in a few months but it’s been a good start.”

Still, the proliferation of concentrate offered by miners is indicating to some that the spot market could soften; some miners cut tonnage to be delivered against benchmark-linked contracts this year in favor of selling more on the spot market.

"I’ve never seen so much tonnage offered in such as short space of time," the first trader said.

In mining news, Capstone has agreed to sell its Minto mine to Pembridge Resources for $37.5 million, it said on February 14.

Pembridge Resources expects to extend the mine life of Minto beyond its current 2021 mine life, it said in a release.

Julian Luk in London and Danielle Assalve in Sao Paulo contributed to this report.