According to reports, Freeport-McMoRan (FCX.US) is selling copper concentrate at an unexpectedly large scale following the sudden shutdown of its Indonesian smelter, providing short-term relief for smelting companies facing historic supply shortages.
The unusual sales activity stems from a sudden failure in the oxygen system at Freeport-McMoRan's PT Smelting facility, which has forced an extension of what was originally planned as a four-week maintenance period. The smelter primarily processes ore from the company's flagship Grasberg copper-gold mine.
The shutdown has released approximately 100,000 tons of Grasberg copper concentrate inventory. With a temporary export permit set to expire in mid-September, the company is rushing to arrange shipments to meet the deadline.
Analysts note that while this supply volume has limited impact on the global copper market, it will inject considerable short-term liquidity into the spot market amid intensifying competition for raw materials as global smelting capacity surges.
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