2018 looks like a very good year for Chilean copper mining companies. With China's imports of scrap and its neighboring Peru's exports, according to BMO Capital Markets, buyers in the Chinese market will have to rely even more on the availability of the world's largest producer.

China's sanctions on imported scrap metal were announced back in August last year, but BMO analysts Colin Hamilton and Kash Kamal wrote in an e-mail that the effects of these new customs policies are now beginning to feel. They said that import licenses for scrap dealers had "drastically dropped" and that "major damage" occurred in the Chinese market.

Banks said that while more permits may be issued, Chinese buyers will likely shift to importing more copper concentrate.

According to the BMO, 48% of China's copper imports by 2018 will be in the form of copper concentrates, almost doubling the proportion ten years ago.

Analysts said Chile will once again assume the task this year as China imports more concentrate. After a period of strong growth, Peru's exports started to fall this year.

Chile will remain the largest supplier of copper concentrates to the Chinese market, but Chile will face more labor contract renewal issues this year, and the supply of Chinese demand may become difficult. Any major disruption to mine supplies could push the copper market into a shortage. Escondida, the world's largest copper mine, continued its strong performance with a long strike earlier in the year.

The strike risk in Chile, the largest producer of copper, is rising. The market is worried that the threat of disruption to supply from wage negotiations is the main reason for pushing copper prices to their highest in nearly 4 years in December last year.

Analysts from ING Bank of the Netherlands said the market is now premature to speculate on the supply of terminal risk.

Analysts Hamza Khan, Warren Patterson and Oliver Nugent said in a Wednesday e-mail that the vast majority of contractual contracts that require renewal will not expire until the second half of the year, and miners will most likely Promote wage negotiations as soon as possible peacefully

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