Part of the Miscon Group, Logisminsa began to operate as a bonded warehouse in December 2017 and expects to handle at least 1,300 containers by the end of 2018, one source familiar with the matter said.

The company opened for business in March 2017 as an alternative warehouse service beyond the Trafigura-Glencore-Louis Dreyfus triumvirate in Callao, Peru’s main trading port.

“Several traders and miners have been using Logisminsa services as this is an interesting option to those who do not have their own warehouse,” the source said.

Logisminsa has the permits to store copper, zinc and lead, but the latter needs a special building to ensure that no environmental contamination can take place.

To meet that requirement, the company had initially intended to build this year an underground lead concentrates storage area at its site in Ventanilla, which is 14 km from the port of Callao.

But the current lack of visibility about what will happen in the Peruvian lead market led Logisminsa to shelve the plans, Metal Bulletin understands.

“There is an uncertainty about lead concentrates availability now, so the company has decided to postpone the construction [of the lead storage facility],” the source said.

Such doubts were heightened by Glencore’s acquisition of the controlling stake in zinc-lead-silver miner Volcan Compañía Minera in the last quarter of 2017.

Glencore operates the Perubar warehouse, blending and loading terminal in Callao. This could mean that Volcan’s lead and the volumes it acquires from smaller companies may no longer be available for storage at Logisminsa.

“It does not make sense for a company to make a significant investment like that when you have so little visibility of what will happen,” the source added.

Treatment charges (TCs) for spot zinc and lead concentrates continued to trade at multi-year lows last month, according to Metal Bulletin’s latest assessments, with spot terms for zinc concentrates remaining at $10-30 per tonne at the end of February.

Meanwhile, TCs for lead concentrates were also flat on January’s levels; spot market tonnages on a cif China basis were quoted at $10-25 per tonne on February 23.