China's monthly copper concentrate imports in Q4 may only maintain the average level of copper concentrate imports within the year [SMM Analysis]

In September 2024, China imported 2.436 million mt of copper concentrates and ores, down 5.4% MoM, up 8.7% YoY. From January to September, the cumulative imports of copper ores and concentrates reached 21.055 million mt, up 3.7% YoY.

Although China's copper concentrate imports in September decreased MoM, the import volume of 2.436 million mt in September was still higher than the average import volume of 2.343 million mt within the year. It is reasonable that SMM copper concentrate imports in September remained at a high level. Firstly, China's new smelting capacity has started production but has not yet fed raw materials. Smelters need to prepare for the raw materials feeding before the end of the year. For example, the expansion capacity at Jinchuan headquarters has started production but has not yet fed raw materials, the expansion capacity at Guangxi Jinchuan has started production but has not yet fed raw materials, and on October 21, the pyrometallurgical system of the Southwest Copper relocation project successfully fed raw materials. Secondly, from November to December, Chinese smelters will start negotiations for 2025 long-term contracts with overseas mining companies. Smelters tend to increase their bargaining chips before the negotiations begin, which means reducing spot demand for November and December. Lastly, some smelters have gradually started their raw material stockpiling for winter this year.

It is worth mentioning that SMM expects that in October or November, China's monthly copper concentrate imports may only maintain the average import level within the year. This is because, since the production accident at Daye Yangxin Hongsheng Smelter, its raw material department has adopted a swap strategy. Daye has swapped most of its Q4 copper concentrate with other smelters that also use Yangtze River shipping, and these smelters will swap their Q1 raw materials next year with Daye. Therefore, these large smelters using Yangtze River shipping do not have a significant raw material gap for Q4 this year.