Jiangxi Copper, China’s largest supplier of refined copper, forecasts that the global shortage of copper ore will persist into the second half of the year, continuing to exert downward pressure on processing fees. The company highlighted this in its recent earnings report, noting an increasing certainty that supply constraints at mines will remain a challenge.
The ongoing ore shortage has created a significant imbalance as processing capacity outpaces the availability of raw materials from mining operations. This imbalance has led to a sharp decline in processing fees, which have hovered near or below zero since April.
China, which accounts for more than half of the world’s refined copper supply, has been particularly affected by disruptions at global mining operations. The situation has been further exacerbated by an increase in smelting capacity across Asia, intensifying the competition for limited ore supplies.
Although China’s refined copper output dropped from its record high in December, it still saw an increase in production over the first seven months of the year compared to the previous year. The shortfall in ore supply was partly offset by production from scrap metal and blister copper imports.
Despite the challenging supply environment, Jiangxi Copper managed to boost its refined copper output by 19% in the first half of the year, reaching 1.18 million tons. The company’s net income also rose to 3.6 billion yuan ($505 million), supported by higher copper prices, which hit a record high in May. 
