Chinalco, a leading Chinese metals producer, has successfully commissioned a new copper anode furnace. This occurred at its Dianzhong smelter in Chuxiong city, Yunnan province. The upgrade significantly increases the smelter’s production capacity. Specifically, it raises the copper anode smelting capacity from 191,700 tonnes per year to 249,800 tonnes per year. Furthermore, a refining facility for 210,000 tonnes per year of copper cathode is set to launch in May.
This 515 million yuan ($70.2 million) investment reflects Chinalco’s commitment to expanding its copper operations. Consequently, the Dianzhong smelter will enhance its use of secondary copper. This is achieved by adding a copper scrap feeding facility to each furnace. Therefore, the project aims to optimize feedstock utilization.
Increased Copper Scrap Utilization
Notably, copper scrap has emerged as a crucial feedstock. In 2023, over 31% of China’s refined copper output came from copper scrap. This data comes from the China Nonferrous Metals Industry Association. Moreover, rising copper concentrate costs have driven many producers to switch to copper scrap. Consequently, China’s copper scrap imports surged by 14% year-on-year. Specifically, they reached 2.03 million tonnes between January and November, according to customs data.
SMP Analysis
SuperMetalPrice observes that this upgrade by Chinalco aligns with the industry trend. Moreover, it reflects the increasing reliance on copper scrap. Additionally, it shows Chinalco’s efforts to enhance production efficiency. These developments impact the global copper market. Therefore, the increased use of scrap will affect future copper concentrate demand.
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