KGHM is extending its agreement with China Minmetals. The agreement value could be up to USD 4.882 billion

From 2024 to 2028, KGHM will sell a total of 250,000 to 600,000 tons of copper to China Minmetals. The commercial terms for each year will be specified in detail on an ongoing basis in the annual contracts concluded under the framework agreement in question. The estimated value of the five-year agreement as quoted on the date of signing is between USD 2.034 billion and USD 4.882 billion.

The agreement was made another edition of the CIIE (China International Import Export) fair in Shanghai. The agreement specifies the number of cathodes to be sold in each year, the quantity options, the delivery bases, and other logistical and legal details. The current framework agreement for 2019-2023 was concluded with China Minmetals Nonferrous Metals Co., Ltd. in November 2018 during the first edition of the fair.

“The new framework agreement with China Minmetals is the result of good cooperation between the companies and KGHM’s successful sales policy. The signed agreement ensures stable revenue for us over the next five years, guarantees us a market for our products, and ensures geographic diversification, which is particularly important in the event of a possible downturn in the European market,” said Tomasz Zdzikot, KGHM’s CEO.

LONG-TERM COOPERATION

This year marks 26 years of commercial cooperation between KGHM Polska Miedź S.A. and its Chinese partners.  The first agreement for the supply of copper to China was signed in 1998. The current agreements have been signed with China Minmetals Nonferrous Metals Co., Ltd. which is a part of the China Minmetals Group. China Minmetals Group companies are the largest buyers of KGHM’s copper cathodes in the Chinese market.

“The signing of an agreement for further copper deliveries to China would not have been possible without a consistently implemented sales policy, the excellent quality of our products, and the trade relations with our partners from the Middle Kingdom developed over the years,” said Mirosław Kidoń, KGHM’s Deputy CEO for Foreign Assets and acting Deputy CEO for Development.

Under the new agreement, copper cathodes will be delivered to China Minmetals Nonferrous Metals Co., Ltd. Copper cathodes are KGHM’s primary product, which is produced at the Głogów and Legnica Copper Smelters. They are of very high quality, as confirmed by certificates issued by the London Metal Exchange, the Shanghai Futures Exchange and the Shanghai International Energy Exchange (INE). The quality is guaranteed by brands: HML for the “Legnica” Smelter, HMG-S for the “Głogów I” Smelter, and HMG-B for the “Głogów” Smelter, under which they are registered on the London Metal Exchange in grade “A.”

PRODUCTS AND SERVICES AT THE HIGHEST LEVEL

In addition to copper cathodes, KGHM’s portfolio includes, among other things, copper wire rod, oxygen-free copper wire, as well as precious metals (silver in the form of granules and pigs, and gold in the form of bars), molybdenum, and rhenium.

KGHM’s products and services meet the highest market standards, while the stability of raw materials, the speed of response to the customers’ needs, and the efficient logistics allow the company to strengthen its status as a preferred supplier.

KGHM’s copper smelters produce metals responsibly and in compliance with the highest standards. The Głogów Copper Smelter, the Legnica Copper Smelter, and the Cedynia Copper Smelter hold the prestigious Copper Mark, which is a certificate of responsible action with regard to the environment, employees, local communities, and corporate governance.

KGHM has also released the results of an analysis of the environmental and carbon footprint of its products: cathodes, wire rod, and Cu-OFE wire. The footprint of KGHM’s copper products is lower than the global average.

THE SHANGHAI FAIR AND CHINA MINMETALS CORPORATION

The sixth edition of the CIIE (China International Import Export) Fair ended on November 10 in Shanghai. A total of 154 countries, regions, and international organizations confirmed their participation, and the business exhibition brought together 289 of the world’s 500 largest companies and industry giants. The CIIE once again included a business exhibition, a national exhibition, the Hongqiao International Economic Forum, a number of supporting activities, as well as cultural exchange events.

The China Minmetals Corporation was founded in 1950. It is a manufacturing and trading group operating mainly in the metals, minerals, mining and metallurgical technology, and electrical products sectors. It is also involved in areas such as finance, real estate, transportation, and engineering and investment projects, being one of the country’s most important importers and exporters. The corporation is a full or partial shareholder in a number of businesses in 34 countries and regions around the world, employing approximately 194,000 workers.