Pan Pacific Copper to Revise Ingot Sales Conditions in Japan

Pan Pacific Copper, which is joint venture of Nippon Mining & Metals and Mitsui Mining & Smelting, started study to improve the collateral conditions of copper ingot long term sales contracts. The firm has provided sweet condition to the users instead of adding 3% premium on the selling price to meet 3% import tariff for copper ingot with less than 500,000 yen per tonne value. However, the ingot increased to more than 500,000 yen. The firm tries to improve the collateral condition for shipment in 2008 when the copper purchase condition is worsening. Domestic copper smelters supply ingot to users including electric wire makers and rolled copper makers with annual contracts. The smelters provide sweet condition for the users including volume options and settlements. However, Pan Pacific Copper started the revision for the collateral conditions in 2008 to cover higher actual copper ore purchase price. The firm tries to improve the condition as CODELCO of Chile and offshore smelters. Japanese smelters agreed with offshore miners to increase the actual copper ore purchase price by 8-16% for 2007-2008 shipment. The smelters cannot have merit from additional increase of copper ingot price when copper miners terminated the price participation last year.