Chinese Copper Exporters to Benefit from Relaxation of Copper Concentrate Import Policy, SMM Reports

SHANGHAI, Jul. 26 (SMM) –China has recently allowed more domestic companies to import copper concentrate under feeding processing trade, a move that will reduce their export costs, SMM learned.

Besides, the move will also help mitigate losses or even bring fat profit for exporters when copper prices in international market are much higher than in domestic market, SMM pointed out. 

Smelters that import copper concentrate under general trade and turn such ore into refined copper need to pay 5%-10% export duty. However, smelters qualified to import copper concentrate under feeding processing trade are exempt from export duty. This is why refined copper exports under feeding processing trade have taken up a growing share of total exports in recent years, SMM understood.

Copper concentrate was banned from feeding processing trade in 2006. Policy tightened after seven copper companies were allowed to conduct feeding processing trade in 2009. However, such policy loosened in recent two years, with another six companies allowed to engage in such business. 

Refined copper output at 13 smelters that obtained qualifications to import copper concentrate under feeding processing trade around 2016 accounted for 75%-80% of China’s total output, SMM statistics showed.   

Companies that were recently allowed to conduct such business are Zhejiang Fuye Heding Copper, Henan Yuguang Gold & Lead, and Chifeng Yuntong Nonferrous Metals. 

China will further loosen qualifications for copper concentrate imports under feeding processing trade, SMM expects.

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