Chinese Copper Concentrate: Tight Supply Pushes Processing Fees To New Lows

Due to the continued tight supply, the processing fee for imported copper concentrate in China (TC/RCs) continued its downward trend that began in mid-February and last week continued to set new historical lows. The weekly Agios weekly purchase TC index decreased by $1.4 per ton and 0.14 cents per pound on August 14 compared to August 7. The purchase TC index for traders decreased by $2.6 per ton and 0.26 cents per pound. In the smelter market, a batch of clean copper concentrate was sold at an index discount of $23 per ton, with shipment due in October. A batch of Carmen copper concentrate was sold at an index discount of $25 per ton, with shipment due in September. Sellers' quotations were mostly at an index discount of $30 per ton. Market participants indicated that the tradable level of fixed-price TC was approximately between -$190 per ton and -$170 per ton, reflecting the continuous competition among smelters for the limited copper concentrate. Due to the tight supply of copper concentrate, it is expected that the processing fee will continue to be under pressure in the near future. The copper production of Chilean mining company Antofagasta for the 1st to 6th months decreased by 9% year-on-year. The company lowered its 2026 copper production guidance by approximately 5% to 625,000 - 655,000 tons, further deepening market concerns about future supply. In the trader market, a batch of 10,000 tons of Chuquicamata copper concentrate was sold at -$230 per ton. The mining dynamics announced that the Chilean state-owned copper producer Codelco has decided to proceed with four mine life extension projects, although the project development of its El Teniente mine in central Chile has been suspended due to earthquake risks. Due to the increase in Escondida mine production, Chile's copper production in June increased by 5.2% year-on-year, but its total production in the first half of the year still decreased by 6.6%.