China copper output jumps to record despite low smelting fees

Chinese copper smelters boosted output to a record high last month, as rising prices for by-products including gold and sulphuric acid eased pressure on margins.
Smelters in the world’s biggest copper producer have struggled with low profitability and pressure for production cuts after their rapid expansion outpaced global ore supplies, pushing processing fees below zero. That blow has been softened this year by gold extending its breakneck rally and more revenue from sulphuric acid that’s sold to other industries.
Production of refined metal rose 8.6% in March from a year earlier to 1.25 million tons, according to China’s National Bureau of Statistics. That was just above the previous monthly high of 1.24 million tons in December last year.
Copper smelters in China can extract gold from copper ore, and either refine it themselves or ship it to third parties, meaning they can benefit from the precious metal’s rapid ascent. Bullion has surged more than 60% since the end of 2023 and is trading above $3,300 a ton.
“Smelters have been enjoying very good sales of sulphuric acid, while the profit contribution from gold is also significant,” said Fan Rui, an analyst at Guoyuan Futures Co. This is all making things less difficult for smelters, she said.
Sulphuric acid is a common by-product of metals smelting, and can be shipped to customers in industries like fertilizers, chemicals and oil refining. Prices are up nearly 50% this year and reached their highest since 2022 in March, according to NBS data.
China’s total output of refined copper for the first quarter was 3.54 million tons, up 5% from a year earlier.
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