copper costs

could have some effect on next weeks production numbers


Kazuhiro Shimamura | January 15, 2009
Article from: Dow Jones Newswires
NIPPON Mining and Metals said today BHP Billiton has agreed to a 70 per cent increase in the copper processing fee it pays to Nippon Mining's copper business joint venture for 2009.

The deal effectively lowers the copper price for the first time in three years in the wake of the global economic slowdown.

The agreement was reached yesterday between BHP Billiton and Pan Pacific Copper, a joint venture with Mitsui Mining and Smelting, a Nippon Mining spokesman said.

Nippon Mining declined to disclose the processing fee.

The higher processing fee - a source of revenue for smelters - will lower BHP's copper price which is set by deducting the fee from the copper price smelters pay to mining companies.

Pan Pacific's newly set fee is in line with the earlier deal between Freeport McMoRan and Mitsubishi Materials, settled at $US75 per tonne for smelting ore, which will act as the benchmark for other smelters such as Sumitomo Metal Mining.

Nippon Mining is a unit of Nippon Mining Holdings.