• Tight copper concentrate supplies eroding smelter profits
• CNIA sees China's recycled copper volumes up 1 mln tons by 2030
• Calls for industry consolidation to boost purchasing power

SHANGHAI, Nov 13 (Reuters) - Using more aluminium and recycled copper would help China cope with scarce copper resources, an industry group said on Wednesday, at a time when tight copper concentrate supplies are eroding profits at Chinese smelters.

"The copper industry faces many uncertainties and severe challenges ... profit of smelters, in many cases, is not from copper but from byproducts with some already suffering loss," Ge Honglin, chairman of the China Nonferrous Metals Industry Association (CNIA), told a conference.

Global miners and smelters in the world's largest copper producer and consumer usually meet in Shanghai every November for the Asia Copper Week gathering to negotiate their copper concentrate contracts and settle treatment and refining charges (TC/RCs) for the following year.

TC/RCs, which typically fall when ore supply declines, are a key source of revenue for smelters paid by miners.

The fees are expected to be set at a 15-year-low in 2025, a survey of industry participants found.

Using more recycled copper could reduce China's reliance on overseas resources, which is currently more than 70%, Ge said.

China's recycled copper volume will rise from 2.5 million metric tons in 2024 to 2.7 million tons in 2025 and 3.5 million tons by 2030, Ge forecast, encouraging Chinese companies to go to politically stable areas abroad to secure more recycled copper resources.

China has allowed imports of more recycled copper and established a new state-backed recycling company to help reduce reliance on primary raw materials.

Ge called for mergers and the reorganisation of China's copper refining capacity to increase industrial consolidation so as to enhance negotiating power to buy concentrate.

ALUMINIUM-COPPER SUBSTITUTION

Using aluminium to replace copper already presents economic advantages, said Ge, with copper prices more than 3.5 times those of aluminium.

China buys 60% of resources needed to produce aluminium from abroad, and Chinese-funded companies have acquired more than 8 billion tons of foreign bauxite, more than a quarter of the total overseas reserves, said Ge.

Bauxite is refined into alumina, the main ingredient for making aluminium.

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https://www.reuters.com/markets/commodities/existing-mines-projects-can-only-meet-80-global-copper-demand-by-2030-minmetals-2024-11-13/