Mid-year negotiations between global mining companies and Japanese copper producers over copper treatment and refining charges have settled below the level agreed for 2010 contracts, an executive from a Japanese smelting company involved in the negotiations said Tuesday.

The executive said he couldn't reveal the exact figure but confirmed his company had settled TC/RCs with BHP Billiton (BHP.AU) at below $47 a metric ton and 4.7 cents a pound agreed in January 2010.

The mid-year negotiations typically cover around 10% of annual copper concentrate offtake and usually provide an indication of where the next year's annual fees might settle.

He said the TC/RCs were unsustainably low and below the cash costs the smelters needed to break even.

"At these levels even Chinese smelters will have to cut output. For Japanese and European smelters they are impossible over the long term."

TC/RCs are paid by miners to smelters in order to turn copper concentrate into copper cathode. They are the key source of revenue for smelters, and tend to fall when concentrate availability is scarce and smelters are forced to offer competitive fees to attract limited business.

Reuters reported Tuesday that both Sumitomo Metal Mining Co. (5713.TO) and Mitsubishi Materials Corp (5711.TO) had agreed mid-year fees with BHP Billiton but didn't specify the TC/RCs level.

-By James Campbell, Dow Jones Newswires, +656415-4082; james.campbell@dowjones.com