Aurubis keeps European Cu premium at $228/t

Market: Metals
02/10/24

Europe's largest copper producer and recycler, Aurubis, will maintain a premium of $228/t to the official London Metal Exchange (LME) copper price for 2025, unchanged for a third consecutive year, the company told customers last week.

The annual premium for Europe, which is set on an fca basis, was lifted by 85pc from the 2022 premium to $228/t for 2023, owing to increased production costs primarily linked to higher energy prices, and high freight charges aligned with tight supply and steady demand.

This dynamic has remained in place in Europe's copper market over the past two years, and has also been reflected in extremely stable spot market pricing for premiums during this time. Argus assessed the spot premium for grade A copper cathode delivered to Germany at $180-200/t on 1 October, virtually unchanged from a year ago.

South American copper producers have not yet settled a separate 2025 premium with European customers, but it could come in below the Aurubis figure, market participants said.

Subdued European demand for copper prevented any uplift in the Aurubis annual premium. Consumers maintain a bearish outlook for next year because of sluggish activity in downstream sectors, with the construction sector being particularly quiet.

Three-month copper prices on the LME climbed to $10,024/t in today's official session, surpassing $10,000/t for the first time since June. The rise follows optimism in the market because of China's announcement of new economic stimulus measures last week, supported by an increase in oil prices following Iran's missile attack on Israel yesterday.

By Roxana Lazar

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