Chinese smelters expect supplies of copper concentrate to rise as early as late 2012, paving the way for higher charges, as neighbouring Mongolia's Oyu Tolgoi copper and gold mine starts to come onstream, industry sources said on Tuesday.

That may prompt Chinese smelters to raise term treatment and refining charges (TC/RCs) requirements for 2012 after they won a more than 50 percent on-year increase to $72 a ton and 7.2 US cents a pound for the first half of 2011 and $90 and 9 cents for the second half.

Oyu Tolgoi, the world's largest undeveloped copper and gold project located 80 kilometers (47 miles) north of the Mongolia-China border, is 66 percent owned by Canada-listed Ivanhoe Mines Ltd.

The government of Mongolia holds the remaining share. Global miner Rio Tinto presently holds a 46.5 interest in Ivanhoe Mines, according to the Ivanhoe website.

"The startup (of Oyu Tolgoi) may help improve the concentrate shortage in the Chinese domestic market," Yang Changhua, senior analyst at state-backed research firm Antaike said.

TC/RCs are paid by overseas sellers to Chinese smelters for converting concentrate imports into refined metal and deducted from concentrate sale prices based on London Metal Exchange copper prices.

Higher charges, typically seen when supply rises or demand falls, cut concentrate import prices.

Spot copper concentrates changed hands at TC/RCs of around $85 and 8.5 cents to China in the past two weeks versus around $100 and 10 cents in June.

Source:CNTV