Global trader Mercuria and Kazakh giant Kazakhmys have formalized a relationship designed for the long term. The parties signed an agreement that guarantees supplies copper cathodes for the next four years. Every year Kazakhmys will send 200 thousand tons of metal to its partner. If you add up all the volumes, you get about 800 thousand tons.
The contract is based on the patterns of the global market. Copper prices are tied to international stock indices, which makes the conditions transparent and understandable for both parties. A Mercuria representative office will appear in Kazakhstan – a marketing and sales office that will promote exports, monitor global conditions and manage financial risks, including hedging.
But the partnership goes far beyond the usual purchase and sale. Mercuria and Kazakhmys have agreed to work together on technological upgrades and environmental projects. We are talking about the digitalization of production, the introduction of modern accounting systems, increasing the depth of processing, recycling waste and reducing energy consumption.
For Kazakhmys, this is a chance to gain a foothold in the pool of reliable partners of one of the leaders in the commodity trade. Mercuria, in turn, gains access to a stable source of quality metal from a region with predictable conditions. The company is present in more than fifty countries, and its annual turnover exceeds $170 billion.
The deal strengthens Kazakhstan’s position on the map of the global copper industry. The transition to international pricing standards increases the attractiveness of local metal for buyers. And the technological component of the agreement promises not only revenue, but also new competencies that will remain in the country.
Source: @metalsesgtrends
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