Redirection of copper concentrate shipments by Brazilian copper smelter to shore up spot TCs

As of September 15, the SMM Imported Copper Concentrate Index (Weekly) stood at $93.19/mt, $0.15/mt lower than a week earlier. Spot copper concentrate trading improved slightly. The price coefficient of Cu 20% domestic ore stood at 88.5-89.5%.

In the spot market, SMM understood that there was a deal of 10,000 mt of QB2 spot copper concentrate between traders last week, with TCs in the low $90s, scheduled for October. According to feedback from market participants, during the week, traders resold 20,000 mt of Caraiba copper concentrate with TCs in the mid-to-low $90s. There was also a trade of 10,000 mt of clean ore scheduled for October at a TC in the low $90s, as well as a deal of blended concentrate with TCs in the mid-to-high $90s. Inquiries of buyers for clean ore that was scheduled to be shipped in November stood at $95/mt, while the sellers offered in the low $90s.

On the morning of September 20, the Liaoning Yingkou Jianfa Shenghai Polymetal Comprehensive Utilization Technology Upgrading Project, located in the Liaoning (Yingkou) Coastal Industrial Base, officially started construction. The project is jointly funded and constructed by Xiamen Jianfa Group Co. and Liaoning Shenghai Industrial Group, with a total investment of 12.15 billion yuan. The project will be built in two phases and after being put into operation, it can yield an annual output of 600,000 mt of copper cathode. It will also use 2.36 million mt of sulphuric acid, a by-product of the copper smelting project, to produce 300,000 mt of industrial-grade phosphoric acid and 100,000 mt of iron phosphate for new energy batteries. According to SMM survey, the first phase of the project is expected to be completed and start feeding materials in October 2025, which has smelting and refining capacity of 300,000 mt apiece.

SMM believes that Chinese smelters will restock raw material inventories ahead of the negotiations on next year’s benchmark TC for long-term contracts in a bid to obtain more negotiation power over pricing, lowering spot TCs. Nonetheless, copper concentrate supposed to be supplied to Brazil's Paranapanema smelter was offered for sale in the market as the smelter underwent cash flow issues. This will give more support to the spot TCs of imported copper concentrate. According to SMM statistics, the inventory of copper concentrate at seven Chinese ports was 990,000 mt as of September 15, a growth of 53,000 mt from a week earlier.