Treatment Charges
Treatment charges are discounts to the exchange set prices for the commodity you are trading. Concentrates are the raw material that is mined from the ground in order to turn into the refined products that are processed into consumable goods. To look at a pile of concentrates you'd be forgiven for mistaking it for dirt - because essentially that's what a large majority of it is. Only a minority of the raw material is metallic content - this is known as 'metal contained'. For example, a copper concentrates shipment might only contain 25% copper, the balance of the parcel is a mix of other chemical elements, but a large majority of it is unusable earth.
Treatment charges are given by miners as a discount to smelters (or traders) in order to process the material and convert that pile of mostly dirt into 99%+ refined metal. The treatment charge is assessed on the entire dry metric tonnage (DMT) of a concentrates parcel. If for example you buy 10,000DMT of zinc concentrates, and it commands a treatment charge of $160/DMT, that is essentially a discount you are receiving of $160 * 10,000 = $1,600,000 from the payable content of that parcel. A trader's job is to buy concentrates from miners at a higher treatment charge (larger discount) than they sell the same material to metal producers. If they sold that same 10,000DMT zinc parcel to a zinc smelter at $140/DMT, they would be making a $20/DMT profit between the treatment charges, or $200,000. The trader is giving a smaller discount to the metal producer than they received from the miner they bought it from.
In general, treatment charges tend to be higher (larger discounts) if a market is deemed soft - when there is a lot of material available for traders and smelters they can command a higher discount to process the material as they have a lot of choices to buy from. The opposite is true in a tight market - treatment charges tend to decrease because traders and smelters have less options for material so miners don't have to give as large of a discount. The reason the copper treatment charge moving to a negative is such a big deal is because it means that instead of miners needing to give smelters discounts to process the material, they are actually receiving a premium for the material, despite the need to process it.
