"The concentrates market is tight right now and treatment charges are soft, we don't expect them to stay that way," said David Goldman, chief executive officer with Noranda inc.

"There's lots of new capacity coming on stream." Spot treatment and refining charges are believed to be hovering in the $45 a tonne/4.5 cent a lb range, with preliminary estimates for the 1999 long-term settlements at $65/6.5 cents.

"I think come 2002 or 2003 we'll see a more ordered situation, with significant price recoveries closer to the historical level of $90-$110/9-11 cents," he said. "But in 1999-2000, we may have to manage with a tight market and softer terms." Goldman noted that when Falconbridge Ltd brings its 450,000 tonne-per-year Collahuasi contained copper mine into full production next year. Noranda owns a 49.9 percent interest inFalconbridge.

Noranda's additional production from its Antamina property, which it co-owns with Rio Algom Ltd and Teck Corp , would bring on more concentrate production when it comes on stream. The three companies are in the process of pursuing financing and are currently in discussions with a consortium of 12 banks, Goldman said. Noranda is currently expanding its Refimet smelter by 11 percent to process 639,000 tonnes of concentrates annually in 1999 and is mulling a further expansion to 800,000 tonnes of concentrate. The concentrate market is expected to tighten further with the announced closure of more than 50,000 tonnes of copper concentrate production by Phelps Dodge Corp from mines in New Mexico and Chile, traders said. This comes in addition to the US production shuttered earlier this year by Phelps Dodge, Cyprus Amax Minerals Co and BHP Copper, a unit of Broken Hill Proprietary Ltd.