China’s top smelters cut Q1 floor price for copper amid supply strain

A group of top copper smelters in China reduced the floor price for copper concentrates treatment and refining charges for the first quarter, in an indication of tighter copper concs supplies, market sources said Dec. 26.

The smelters' group, known as the China Smelters Purchase Team, set the Q1 floor price of TCs/RCs at $25/mt and 2.5 cents/lb, down $10/mt and 1 cent/lb, respectively, from the previous quarter, the sources said. The TC/RCs were 68.8% lower compared to Q1 2024.

Chinese copper concs TC/RCs have been under pressure in 2024 amid supply disruptions at global miners and expanding smelting capacity.

Reflecting the tight copper concs market, Chilean miner Antofagasta and Chinese smelters settled the benchmark TC/RCs for 2025 at $21.25/mt and 2.125 cents/lb, respectively, a decline of over 70% year over year.

Platts assessed CIF China clean copper concentrate TCs and RCs at $1.40/mt and 0.14 cent/lb, respectively, Dec. 24, down $5.50/mt and 0.55 cent/lb from a month earlier, hitting the lowest level since Sept. 20, S&P Global Commodity Insights data showed.

Copper smelters are expected to navigate growing risks in 2025, in view of widening capacity globally at a time when the supply of copper concs remains tight.

Some smelters could cut production due to losses, especially those with fewer long-term contract coverage, sources said.

Jinchuan Group is ramping up the construction of its 300,000 mt/year copper smelting project in Jinchang city of Gansu province, which is expected to commence by the end of December. The company has completed construction of its 300,000 mt/year copper smelting project in Fangchenggang city of Guangxi Zhuang Autonomous Region, sources said.

More usage of scrap, blister and anodes could be observed as substitutes to copper concs by Chinese smelters in 2025, sources said.

Copper miners pay fees in the form of TCs/RCs to smelters for turning ore into refined metal and the TC/RCs are key margins for copper smelters. TC/RCs typically fall in a supply deficit and rise when the supply grows.