The premiums, to be paid on top of London Metal Exchange prices for delivery of copper cathodes, a basic form of copper used to make products such as copper rods and tubes, are seen as a benchmark for global contracts.
China, as the world's biggest copper consumer, is Codelco's most important market, and flat premiums are viewed in the trade as suggesting subdued demand.
"The offers were sent yesterday and the day before and the agreements are happening today," one person said, speaking late on Tuesday. The person declined to be identified as the information hadn't officially been made public.
The Codelco premium is slightly higher than current Yangshan premium levels <SMM-CUYP-CN> of $83 a tonne for copper in bonded warehouses in China, although Codelco's premium is on a cost, insurance, freight basis, where the seller covers the transportation costs.
The keenly watched Yangshan premium had sunk to as low as $36 a tonne at the end of April, pointing to lacklustre physical demand in China, before rebounding.
Codelco has "a good product with high liquidity in the China market, so noone will start a fight for a couple of dollars," the second person with knowledge of the matter said. He declined to identify customers that had already accepted the $88 premium, but said contracts were under negotiation for significant quantities of copper cathodes.
He also declined to be identified as the information hadn't officially been made public.
Codelco had already agreed its 2020 physical copper premium for European buyers at $98 a tonne, also the same level as for 2019, copper industry sources said on Friday last week.
Codelco did not immediately respond to a request for comment outside of normal business hours.
(Reporting by Tom Daly in Beijing and Zandi Shabalala in Johannesburg; Editing by Tom Hogue and Kenneth Maxwell)
By Tom Daly and Zandi Shabalala