Copper prices hit 110,000 yuan, with frequent "black swan" events in the mining sector, leading to production cuts at smelters?

1. Copper prices stand at the 110000 mark, Ningxing Copper Industry interprets the current market situation

Recently, domestic copper prices have continued to operate at high levels. Behind the copper price reaching the 110000 mark is a dual resonance of intensified supply disruptions from the mining sector and expected production cuts from the smelting sector. As a company that has been deeply involved in copper processing for many years, Ningxing Copper Industry continues to track the dynamics of the copper industry chain, providing timely market analysis and stable raw material guarantee for downstream customers.

 2.Frequent occurrence of "black swans" in the mining sector, causing multiple impacts on global coppermine supply

Before and after the National Day holiday, the global copper mine supply side experienced a series of "black swan" events. The El Teniente copper mine under Codelco in Chile has been suspended from operations in the southern mining area due to a landslide caused by heavy rainfall, resulting in casualties. At the same time, the strike at Centinela copper mine under Antofagasta officially began on October 7th, and negotiations between labor and management broke down. The union stated that 22% of the direct labor force at the mine participated in the strike. What worries the market even more is that workers at BHP's Escondida copper mine, the world's largest copper mine, are also expected to go on strike on October 14th. The union has called for over 1000 workers, and the Chilean Labor Bureau is conducting emergency mediation.

The combined annual production of these three main mines accounts for over 7.5% of the global copper supply. Once production is limited, the impact on copper supply will be very direct. Ningxing Copper Industry analysis believes that frequent disturbances at the mining end are not isolated events, but structural contradictions in the context of the increasing scarcity and difficulty of mining high-quality copper resources worldwide.

3.Processing fees fall to historic low, signal of passive production reduction by smelters is clear

The most direct manifestation of the tension in the mining sector is the continuous sharp decline in spot processing fees for copper concentrate. As of October 9th, the TC spot price has fallen to -238 US dollars per ton, the lowest level since September 2007. This means that smelters need to pay up to $238 to mines for each ton of copper concentrate processed, rather than charging processing fees. The smelter using spot copper ore had an average monthly loss of 4129 yuan/ton in September, and the loss is expected to further expand to 5000 yuan/ton in October. Under such severe profit pressure, the reduction of production by domestic smelters has moved from expectations to reality. In September, the domestic electrolytic copper production was 1.1206 million tons, a decrease of 2.3% compared to the previous month. According to SMM's forecast, production in October will further decrease to 1084700 tons, the lowest level in 2026, and proactive production cuts will become a new factor contributing to the decline in production.

4. Ningxing Copper Industry responds to supply challenges under the tight supply of raw materials

Faced with the industry changes of tight supply of copper concentrate and reduced production at the smelting end, Ningxing Copper Industry relies on years of accumulated supply chain resources and inventory management capabilities to ensure stable supply of various copper bars, copper rods, and special-shaped copper materials. We maintain long-term cooperative relationships with multiple mainstream smelting enterprises in China, and can provide customers with competitive prices and reliable delivery guarantees.

Ningxing Copper Industry suggests downstream customers pay attention to the risk of copper price fluctuations in the fourth quarter and make advance plans for raw material procurement. If you need to learn about the latest copper material quotations or customized copper material solutions, please visit our official website or call us directly for consultation.