R3D Resources Gets First Shipment Ready As Copper Rallies Back Above US$9,000 A Tonne

R3D Resources Ltd (ASX: R3D) has produced its first shipment of 28 bulk bags (~34 tonnes) of copper sulphate which is ready for collection at the Tartana mine site in the Chillagoe Region of Far North Queensland.

The company’s first production comes at a time when London Metal Exchange (LME) copper prices rallied back above US$9,000 a tonne as investors weighed upbeat factory data from top consumer China.

R3D’s copper sulphate comprises 25% copper and is priced at 25% of the LME copper price plus a premium.

Product enters Australian technical grade market

R3D Managing Director Stephen Bartrop said: “It is very exciting to announce the milestone of the first shipment of Copper Sulphate which is ready for pick up by our offtake partner Kanins.”

Bartrop noted that this is an important milestone and it means that Tartana’s copper sulphate is now entering the Australian technical grade market.

Production to resume early next week

Production at Tartana is expected to resume early next week, pending a supply of reagents and additional pumps.

R3D expects its offtake partner Kanins to pay for its first shipment at the mine gate, pending the arrangement of transportation of the product.

The Walsh River crossing nearest to the Tartana site continues to be at a level making truck transportation difficult – both for R3D’s product to leave the site, and for input materials to be received.

Copper market outlook

Investors are becoming more optimistic about China after its official manufacturing purchasing managers index in March registered the highest reading in a year.

This is the latest green shoot alongside strong exports and rising consumer prices.

A factory gauge in the US also unexpectedly bounced back from 16 consecutive months of decline.

This recovery trend in the manufacturing industry supports consumption of raw materials like copper which are facing significant potential supply-side constraints.

A looming copper crunch is on the horizon as miner production cuts start to bite. Macquarie has slashed its 2024 copper supply forecast by a significant 1 million tonnes.

This squeeze on raw materials is pushing many copper smelters, which refine the metal, into the red due to fierce competition for a limited supply.

The company received $1.5 million in firm commitments received for capital raisings in March 2024.

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