Copper bids low, Codelco withdraws tender

Dec 15, 2010 | 12:44 PM |

Corporacion Nacional de Cobre de Chile (Codelco) has withdrawn its most recent public tender after receiving bids it considered too low.

The news has sparked speculation that the world's largest copper producer may be meeting resistance to its efforts to increase premiums on contracts next year.

A global tender for about 5,000 tonnes per month for March through December 2011 did not attract bids high enough to satisfy the Chilean producer, a market source said, and it was subsequently withdrawn.

A source familiar with the situation confirmed that the tender issued from Codelco's headquarters in Santiago, Chile, was not awarded but declined to give details on the terms of the rejected bids, and a company spokeswoman told AMM that Codelco doesn't comment on specific transactions.

The 10-month term may indicate that Codelco is sold out of material for the first two months of 2011. But industry participants suggested that the state-owned company may have overestimated Asian demand and the needs of producers and traders. ....