Copper Hits Record High, Smelters Lose Money
Copper surged to an all‑time high of $14,779 per ton on the LME, while smelters face zero or even negative treatment charges, erasing profits on every ton processed. The collapse in smelting margins is driven by China’s dominance, new Indonesian capacity, and looming U.S. tariffs, tightening the supply of concentrate. Spot rates in the U.S. are near $6.75 per pound, mirroring the London surge. The market now reflects a shift in control of value from miners to smelters, with negative charges becoming the new norm.
Copper surged to an all‑time high of $14,779 per ton on the LME, while smelters face zero or even negative treatment charges, erasing profits on every ton processed. The collapse in smelting margins is driven by China’s dominance, new Indonesian capacity, and looming U.S. tariffs, tightening the supply of concentrate. Spot rates in the U.S. are near $6.75 per pound, mirroring the London surge. The market now reflects a shift in control of value from miners to smelters, with negative charges becoming the new norm.
Copper prices are likely to stay elevated in the short to medium term, supporting higher revenue for copper traders and catalytic converter manufacturers. However, smelter profitability will remain weak, potentially limiting downstream supply and increasing processing costs for end users. Market participants should monitor China’s smelting capacity and U.S. tariff developments for further price volatility.