From benchmark to question mark: commodity pricing in commercial contracts in an increasingly volatile global market

The global seaborne copper concentrates market is undergoing its most fundamental structural change in decades. The long-standing determination of treatment and refining charges (TC/RCs) is under systemic pressure and is likely to collapse. This change is symptomatic of a broader trend of structural change in global commodities markets that is leading to an increasingly volatile pricing environment. This has material implications not only for offtake agreements, but for a large range of commercial contractual arrangements in the mining and metals sector that rely on benchmark or index-based pricing mechanisms.