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Spot treatment charges paid to Chinese zinc smelters for imported zinc concentrates dipped to $20-$30/mt in January from $40-$50/mt in December amid tight concentrate supply, industry sources in China said Wednesday.

In November and October, TCs were higher at $70-$90/mt and $80-$90/mt respectively.

"For imported clean ores, spot TCs have dropped to just $20-$30/mt this month, while for ores with higher impurities, fees are more at $40-$50/mt," a zinc concentrate importer based in northwest China said.

"We are still negotiating concentrate trades with overseas parties and haven't inked any deals yet," he added.

Market participants said spot TCs for Chinese smelters were likely to remain low throughout the first quarter amid expectations concentrate supply in China would remain thin.

"Zinc mines in the autonomous regions of Tibet and Xinjiang, as well as Inner Mongolia in northwest China, are expected to stay inactive until around April, when spring arrives in northern China, limiting domestic zinc concentrate supply in the current quarter," t trader in northwest China said.

Key Chinese zinc producer Jiangxi Copper's subsidiary commodity research arm Jinrui said in a zinc sector report Wednesday that despite domestic zinc concentrate supply having tightened, the price gap between domestic and imported zinc concentrates has narrowed, spurring some Chinese smelters to import at a loss as they could not find adequate supply in China.

"Spot TCs have a chance of rebounding after April if zinc concentrate supply in both China and overseas improves, but if supply stays tight, then TCs will keep hovering around low levels," said a concentrate trader who has supplied smelters in Shaanxi province.

TCs, the fees paid to smelters by mines for converting concentrate into refined zinc, are a main source of revenue for smelters.

China imported 254,963 mt zinc concentrate in November 2016, almost double the 138,525 mt imported in October. However over January-October it imported 1.798 million mt, down 40% year on year, latest General Administration of Customs data showed.

Australia, Peru, and Mongolia accounted for the bulk of the zinc concentrate import volume in the period.

The world's main zinc miner, Australia's MMG, produced 84,192 mt zinc contained metal in concentrate in 2016, down 18% year on year, due to declining ore grades at its Rosebery mine in the island state of Tasmania, company data showed.