LME Copper Faces More Weakness (2015-12-18)

According to SMM market research, the PT Smelting copper smelter in Gresik, Indonesia, temporarily suspended production following an equipment issue in August. The repair work took around two weeks, and the smelter has now returned to normal operating levels. Public disclosures showed that PT Smelting halted operations from August 8 for furnace repairs. The facility, 66%-owned by PT Freeport Indonesia and 34%-owned by Mitsubishi Materials, has expanded copper cathode capacity of approximately 342,000 t/y and concentrate processing capacity of around 1.3 Mt/y. During the temporary shutdown, Freeport adjusted its shipment schedule and accelerated the restart of its new Manyar smelter. With PT Smelting now back at normal operating levels and Manyar resuming concentrate feeding in August and cathode production in September, both of Freeport's copper smelting facilities in Gresik have returned to production. However, Manyar remains in a ramp-up phase, with its operating rate largely dependent on the recovery of concentrate supply from the Grasberg Block Cave mine.

Spot copper in North China was quoted at a premium of 380-480 yuan/mt against the front-month contract, with an average premium of 450 yuan/mt, down 20 yuan/mt from the previous trading day. The average transaction price was 108,495 yuan/mt, up 660 yuan/mt from the previous trading day.

PT Freeport Indonesia has restarted its Manyar copper smelter and entered a gradual ramp-up phase. President Director Tony Wenas said during a parliamentary hearing on September 15 that, as copper concentrate supply from the Grasberg Block Cave (GBC) mine gradually recovers, concentrate feeding at Manyar resumed in August, followed by the restart of copper cathode production in September. Manyar had been operating at reduced levels after the September 2025 GBC incident sharply disrupted concentrate supply, with limited feedstock prioritized for PT Smelting. Manyar is designed to process around 1.7 million tonnes of copper concentrate per year, with copper cathode capacity of approximately 480,000 tonnes per year, while PT Smelting has expanded cathode capacity of around 342,000 tonnes per year. Manyar's current output remains well below its design capacity, with the pace of the ramp-up largely dependent on upstream concentrate availability. Freeport expects GBC's production rate to recover to around 65% in H2 2026, approximately 80% by mid-2027, and close to normal levels by the end of 2027. As mine production recovers, Manyar is expected to further increase its operating rate in 2027.