SHANGHAI, Sept. 23 (SMM) – The average operating rate at Chinese copper smelters rose to 91.15% in August, its highest this year, SMM's latest survey reveals.

As copper prices tumbled in the first half of the year, some smelters chose to close for maintenance, affecting their output. Jiangxi Copper, Tongling Nonferrous Metals, Yunnan Copper, Daye Nonferrous Metals and Zijin Mining completed only 46.7% of H1 production targets, according to their midyear reports.

At the same time, data from the National Bureau of Statistics show the growth of industrial output in August dropped below 7%, and the year-on-year growth of January-August fixed asset investment hit its lowest since 2002. China’s power generation volume in August also posted negative growth. In this scenario, large smelters will need to ramp up production in H2 to complete their annual output target.

Furthermore, TCs for copper concentrate have climbed to $120-130 per tonne, which boosting profits of smelters and encouraging them to step up production.

Once completing targeted output for the year, the five listed companies mentioned above will contribute 240,000 tonnes in copper supply in H2. Plus output growth at Guangxi Jinchuan Nonferrous Metals, North Copper and Yuguang Gold & Lead, copper market will see oversupply in the near future.
 
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