The core logic of the South American steel market is that end-user demand drives everything. Consumption demand is the starting point, filled jointly by local production and imports; imports act as a regulating valve rather than a driving force.

On April 24, the SMM Imported Copper Concentrate Index (weekly) stood at -81.44 USD/dmt, down 2.83 USD/dmt from the previous reading of -78.61 USD/dmt. The deeply negative TC reflects the tightness in the global copper concentrate market, which has already shifted from market expectations to an actual rigid contraction in supply. In the first quarter of 2026, the world's leading mining companies frequently revised down their production guidance, with supply-side disruptions far exceeding early-year forecasts. Freeport significantly lowered its full-year 2026 copper production forecast from 1.542 million tonnes to approximately 1.406 million tonnes, with an expected recovery rate of only 65%, due to slower-than-expected mine recovery at its Grasberg site in Indonesia, affected by mudslides and ore moisture. In addition, road blockades caused by strikes at BHP's Escondida and Zaldivar mines have led to actual production impacts that remain to be monitored. According to SMM exclusive data, the global copper concentrate deficit in 2026 is estimated at 317,000 metal tonnes, a situation that may ease somewhat in 2029. In stark contrast to the persistently falling TC, domestic smelter operating rates remained high in Q1 2026. According to SMM data, China's electrolytic copper output in March 2026 reached 1.2061 million tonnes, up 5.58% month-on-month and 7.49% year-on-year. In Q1 2026, total electrolytic copper output was 3.5278 million tonnes, up 4.60% quarter-on-quarter and 10.45% year-on-year. SMM survey data shows that 11 smelters have confirmed maintenance schedules for Q2 2026. This means that domestic electrolytic copper output is expected to decline in Q2, with spot supplies likely tightening temporarily in May and June. However, some smelters have reported that due to high sulfuric acid prices, maintenance completion times may be brought forward. Sulfuric acid is currently the most important by-product revenue source for the copper smelting industry. According to SMM data, on April 24, 2026, China's copper smelting acid index stood at 1,660.5 RMB/ton, up 31.5 RMB/ton from the previous period. As sulfuric acid revenues have risen steadily from 890 RMB/ton at the start of 2026 to 1,660.5 RMB/ton in April 2026, based on the co-production of 3–4.5 tonnes of sulfuric acid per tonne of electrolytic copper, sulfuric acid income can now cover the copper concentrate procurement cost and part of the processing cost for smelters. The upward slope and magnitude of this increase exceed the deterioration in spot TC. The substantial boost in sulfuric acid profitability allows smelters to tolerate lower TC, creating a cycle of "higher sulfuric acid prices, lower TC." Meanwhile, rising gold and silver prices have further expanded smelters' comprehensive profit margins. Although the copper smelting segment is deeply loss-making, driven by the hefty profits from sulfuric acid, gold, and silver, domestic copper smelters have been able to maintain high operating rates without large-scale production cuts caused by deeply negative TC. Additionally, about 20% of the world's electrolytic copper comes from hydrometallurgical processes, with the DRC and Chile together accounting for nearly 80% of that. Hydrometallurgical copper production consumes large amounts of sulfuric acid, and sulfur is a key raw material for sulfuric acid. The current disruption in the Strait of Hormuz has cut off approximately 50–60% of Middle Eastern sulfur shipments by sea, pushing up sulfur and sulfuric acid prices. Worth noting is that as late April 2026 progresses, sulfuric acid export restrictions combined with increased domestic production have shown signs of price softening. If sulfuric acid prices continue to decline, it will directly squeeze the comprehensive profit margins of domestic smelters. At that point, the dual pressure of persistently low TC and falling sulfuric acid prices could trigger real production cuts on the smelting side. Although gold and silver prices do not directly determine TC trends, their macro-pricing logic as part of the non-ferrous metals sector is worth attention. The market has largely priced in the expectation that the Federal Reserve will not cut interest rates at all in 2026, with the first rate cut possibly delayed until July 2027. For copper, a delayed rate cut means no near-term easing of macro liquidity, but copper's core pricing logic remains the ongoing tug-of-war between tightening supply on the mining side and rigid demand. In other words, precious metals are under pressure, but industrial metals' pricing center remains in real supply-demand fundamentals, which explains why weaker gold and silver prices have not dragged copper prices lower. According to SMM, for Chinese smelters, domestic copper concentrate spot TC transactions are feasible in the range of -81 USD/dmt to -88 USD/dmt. Some holders have attempted to offer TC at -100 USD/dmt, while some smelters are willing to accept deliveries at the lower end around -90 USD/dmt. The downward trend in TC has not yet stopped, and smelter purchasing activity may have weakened slightly, but not significantly. Key areas to watch moving forward: Sulfuric acid side: The price trend will depend on the interplay of multiple factors. First, China's sulfuric acid export policy direction: if export restrictions continue, domestic sulfuric acid supply will be relatively abundant, and prices may fall from highs; if exports are temporarily allowed, overseas hydrometallurgical copper supply risks will rise, but domestic sulfuric acid prices may find support. Second, the recovery of sulfur supply: when shipping through the Strait of Hormuz returns to normal will directly affect the pace at which Middle Eastern sulfur can supplement global markets. Third, seasonal demand changes for downstream products such as phosphate fertilizers will also cause periodic price volatility for sulfuric acid. Mining side: Focus on the progress of the Grasberg conversion project, labor negotiation results at Chilean mines, and logistics stability at mines such as Las Bambas in Peru. Any new supply release will effectively ease TC pressure. Macro side: Monitor the Federal Reserve's monetary policy path, the U.S. dollar index, the actual driving effect of China's pro-growth policies on copper consumption, and whether the growth rate of copper demand in global new energy sectors is slowing marginally.

Around April 23, 2026, import and export data for cobalt and lithium battery industry chain products in March were released. Data showed that March spodumene imports rebounded significantly from February, hitting a new record high of 837,400 mt in physical content. Lithium carbonate side, China imported 29,974 mt of lithium carbonate in March, up 13% MoM and up 65% YoY.......SMM compiled the import and export data for battery materials as follows: Upstream Lithium Concentrates Customs data showed that March spodumene imports rebounded significantly from February, hitting a new record high of 837,400 mt in physical content. By source country: African ore arrivals increased notably — Nigeria imports reached 125,100 mt, up 63% MoM; Zimbabwe shipments from earlier periods arrived at ports in the month totaling 112,600 mt, up 61% MoM; Canada broke the zero-import situation in January-February with 58,600 mt arriving in March; while Australian ore volumes declined MoM due to shipping schedule impacts. According to SMM's screening and analysis, total port arrivals this month were equivalent to 81,000 mt LCE. Lithium concentrates accounted for 72% of the month's imports, down slightly compared to the same period last year, mainly due to the notable increase in South African raw ore port arrivals recently. Notably, driven by prices and local beneficiation plant development, Nigerian ore volumes increased significantly, with not only raw ore volumes rising markedly but also concentrates share increasing notably YoY. Source: China Customs, compiled by SMM Spodumene concentrates (CIF China) spot pricing side, according to SMM spot prices, March spodumene concentrates (CIF China) spot prices showed a V-shaped trend, dropping to a low of $2,028/mt at month-end, then rebounding to $2,313/mt at month-end, with a monthly average of $2,081.4/mt. According to SMM, in March, spodumene and lepidolite profit trends diverged, with structural cost differences among lithium chemicals enterprises becoming evident. Available spodumene volumes were tight, ore traders held back from selling, and inventory continued to be drawn down. Enterprises purchasing spodumene externally suffered losses on spot margins throughout the month, with non-integrated enterprises facing greater difficulties in hedging and procurement. Entering April, spodumene concentrates (CIF China) spot prices also showed a pattern of initial decline followed by recovery. Recently, spodumene concentrates prices continued to probe higher. As of April 27, spodumene concentrates (CIF China) spot prices rose to $2,507/mt, up $194/mt from $2,313/mt at end-March, an increase of 8.39%. According to SMM's recent research, driven by market expectations of improving future demand, speculative sentiment in the lithium carbonate futures market remained strong, pushing futures prices up. Lithium ore merchants showed increased willingness to sell, with pricing-against-futures prices staying high. Looking ahead, lithium chemical plant operating rates stay high, with demand for lithium ore continuing to climb. Meanwhile, Zimbabwe has suspended spodumene exports for nearly two months, leading to persistently tight available lithium ore supply in the market. Overall, spodumene prices are expected to hold up well. Lithium Carbonate According to customs data, China imported 29,974 mt of lithium carbonate in March, up 13% MoM and up 65% YoY. By source, the top 3 were Chile (18,000 mt, 61%), Argentina (8,292 mt, 28%), and Indonesia (2,100 mt, 7%). From January to March, China's cumulative lithium carbonate imports reached 83,000 mt, up 65% YoY cumulatively. China exported 448 mt of lithium carbonate in March, down 25% MoM and up 104% YoY. From January to March, China's cumulative lithium carbonate exports totaled 1,516 mt, up 46% YoY cumulatively. According to SMM spot quotes, lithium carbonate showed a volatile trend of first declining then rising in March. As of March 31, the average spot price of battery-grade lithium carbonate was quoted at 163,000 yuan/mt, with a monthly average price of 156,700 yuan/mt. According to SMM analysis, spot lithium carbonate prices in China showed a significantly volatile upward trend in March, with the monthly average price up 5% MoM. Fundamentals-wise, supply side, production gradually recovered as maintenance ended, and lithium chemical plants showed increased willingness to sell spot orders at the relatively high level around 170,000 yuan/mt; demand side, downstream cathode material producers basically adopted a dip-buying strategy, with strong purchase willingness at price levels around 140,000 to 150,000 yuan/mt. As demand continued to improve, some enterprises engaged in large-scale restocking at low levels. In March, battery-grade spot lithium carbonate prices rose to 172,500 yuan/mt at the beginning of the month and pulled back to around 163,000 yuan/mt at month-end. Recently, battery-grade lithium carbonate spot quotes stayed high above 170,000 yuan. As of April 28, battery-grade lithium carbonate spot quotes were at 172,000-177,000 yuan/mt, with an average price of 174,500 yuan/mt. According to SMM, in today's spot lithium carbonate market, as lithium carbonate prices declined, downstream purchase enthusiasm picked up, with some buyers' target prices basically around 170,000 to 175,000 yuan/mt; upstream spot order quotes remained at high levels. Overall, market inquiries and transactions were relatively active. Looking ahead, the supply side presents mixed signals: Huayou in Zimbabwe announced the successful shipment of lithium sulfate over the weekend, which may ease some supply anxiety in the short term; however, disruptions from mine license renewals in Jiangxi persisted, Middle East geopolitical fluctuations pushed up diesel costs, and some Australian mines confirmed cost increases in their Q1 quarterly reports. Although actual mining has not been affected yet, medium and long-term supply elasticity may be impacted. Demand side, LFP capacity release and the peak season for new car model deliveries in Q2 are expected to continue boosting lithium carbonate demand. Overall, cost support and demand expectations are resonating, and lithium carbonate prices are expected to remain on a relatively strong trend in Q2. Lithium Hydroxide According to customs data, in March 2026, China imported 6,111 mt of lithium hydroxide, up 66% MoM and up 200% YoY. Of this, 2,927 mt came from Indonesia, accounting for approximately 48% of imports, with another 40% from Australia and South Korea. In March, China exported 3,143 mt of lithium hydroxide, up 20% MoM and down 26% YoY, of which 2,059 mt were exported to South Korea and 278 mt to Japan. Battery Materials Ternary Cathode Material In March 2026, China's ternary cathode material (NCM and NCA combined) exports reached 21,900 mt, up 103% MoM and up 163% YoY. Of this, NCM exports were 20,900 mt, accounting for 96%. In terms of export destinations, South Korea was the largest importer of NCM, with March imports of 8,500 mt; Poland, Malaysia, and Japan ranked second, third, and fourth at 3,720 mt, 2,409 mt, and 2,363 mt respectively. In addition, Germany's imports saw significant growth compared to the same period last year. China's ternary cathode material exports hit a record high in March, mainly driven by the cancellation of China's 13% VAT export rebate policy for ternary cathode material effective April 1. Four leading battery cell manufacturers in Japan and South Korea placed orders in advance, boosting demand not only for their domestic plants but also for their battery cell production sites in Southeast Asia and Europe. Beyond the rebate policy impact, EV subsidy policies in Europe also fueled strong demand growth, driving up China's ternary cathode material exports. Among them, the Nordic countries led in EV penetration rate thanks to the most generous subsidies; the UK, France, and Germany continued to serve as important sources of NEV sales support. In contrast, US NEV sales declined notably in Q1, down nearly 30% YoY, significantly impacting Q1 orders for some ex-China battery cell manufacturers targeting the North American market. Looking ahead to Q2, Europe is expected to remain the largest source of incremental ex-China ternary cathode material demand. Despite some disruption from the tax rebate policy, as more battery cell manufacturers and ternary cathode producers plan to complete construction and commence production this year and next, the outlook for European market demand remains optimistic. LiPF6 According to China Customs data, in March 2026, China's cumulative LiPF6 exports totaled approximately 4,554 mt, up approximately 161% MoM, while cumulative imports were approximately 31 mt. Export side, China's LiPF6 exports in March 2026 were approximately 4,554 mt, up approximately 161% MoM from February and up approximately 188.8% YoY. Specifically, as the VAT rebate policy for LiPF6 exports was officially canceled starting April 1, 2026, enterprises rushed to export in advance in March, driving MoM increases in exports to multiple major destination countries. Among them, exports to Poland were 1,723.602 mt (up approximately 693.63% MoM), South Korea 1,099.429 mt (up approximately 184.26% MoM), Czech Republic 460.5 mt (up approximately 237.36% MoM), and Malaysia 249.346 mt (up approximately 141.39% MoM). However, exports to the US declined — 266.146 mt (down approximately 53.70% MoM). Artificial Graphite In March 2026, China's artificial graphite imports were 673 mt, up 0.6% MoM and down 34.1% YoY. Average import price in March 2026 was 61,696 yuan/mt, up 3.9% MoM and up 10.6% YoY. Data source: China Customs, SMM In March 2026, China's artificial graphite exports were 37,525 mt, up 6% MoM and down 16% YoY. Average export price in March 2026 was 9,866 yuan/mt, up 14.4% MoM and down 7% YoY. Flake Graphite In March 2026, China's flake graphite imports were 3,905 mt, up 11% MoM and up 45% YoY. Data source: China Customs, SMM In March 2026, China's flake graphite exports were 8,118 mt, up 35% MoM and up 65% YoY. Phosphate Ore According to customs data, China's phosphate ore imports in March 2026 were 182,000 mt. March imports rose 88.2% from February's 97,000 mt, up 144.4% YoY from 75,000 mt; March total import value was $14.552 million, up 74.6% MoM from February's $8.336 million. Unit price was $79.9/mt, down 7.2% significantly from February's $86.1/mt. In March, China's phosphate ore imports mainly came from Egypt and Pakistan, with imports of 170,000 mt and 12,000 mt respectively. Affected by factors related to the Strait of Hormuz, Jordanian phosphate ore failed to be imported, though imports from other regions filled the gap. Due to hindered transportation of high-priced Jordanian phosphate ore and lack of import volume support, March phosphate ore import unit price declined from February, pulling back to below $80/mt. Cobalt Cobalt Hydrometallurgy Intermediate Products In March 2026, China's cobalt hydrometallurgy intermediate products imports were approximately 1,690 mt in physical content, down 26% MoM and down 97% YoY. Among them, imports from DRC were approximately 1,668 mt in physical content, up 10% MoM and down 97% YoY. In March 2026, the average import price of China's cobalt hydrometallurgy intermediate products was $16,730/mt in physical content, up 2.92% MoM. It was learned that cobalt intermediate products export volume from DRC increased notably in March. If the government maintains this efficient approval pace going forward, quotas for Q4 2025 and Q1/Q2 2026 will most likely be exported within the stipulated timeframe, reducing the probability of further delays. However, shipping in Africa is currently tight, with only a few miners completing small-batch vessel bookings in April. Based on a 1-2 month shipping time from South Africa to China, these intermediate products are expected to arrive at port in May-June, while intermediate products from other miners are not expected to arrive until around July. Unwrought Cobalt In March 2026, China's unwrought cobalt imports were approximately 961 mt, down 44% MoM and up 83% YoY. March imports remained at a relatively high level, mainly due to continued arrivals of export orders placed during the import window opening from late December 2025 to mid-January 2026. On average import price, China's unwrought cobalt average import price in March 2026 was $50,346/mt, up 10% MoM. Cumulative imports from January to March 2026 totaled 4,582 mt, up 206% YoY cumulatively. It was learned that as the import window gradually closed after mid-to-late January 2026, overseas traders' export willingness weakened, and refined cobalt imports in April may continue to decline MoM. Exports, China's unwrought cobalt exports in March 2026 were approximately 413 mt, up 32% MoM and down 69% YoY. By country, China's exports to the US rose slightly, with 280 mt exported to the US in March, up 13% MoM. Average export price, China's average export price of unwrought cobalt in March 2026 was $51,596/mt, down 3% MoM. Cumulative imports from January to March 2026 totaled 1,574 mt, down 52% YoY cumulatively.

Recent Performance of Key Iron Ore Price Spreads Since 2024, large-scale iron ore projects in and outside China have been continuously commissioned, leading to a notable increase in iron ore supply. However, the sharp decline in downstream steel demand caused the iron ore supply-demand gap to widen continuously. The iron ore supply-demand pattern shifted from tight to loose, which also led to a year-on-year decline in average iron ore prices. Nevertheless, influenced by multiple factors such as iron ore supply and demand, port inventory, and steel mill profits, the frequency of price spread fluctuations among iron ore varieties increased. SMM reviewed the recent trends of key price spreads, as detailed below: ◼ Internal Differentiation Among Medium-Grade Resources, with Price Spreads Widening Significantly Affected by long-term contract negotiations, the trade liquidity of mainstream medium-grade ore deteriorated significantly. The lack of trade liquidity in certain varieties was directly transmitted to variety price spreads, with price spread fluctuations of mainstream medium-grade ore such as MNPJ intensifying notably. Among them, the price spread between PB fines and Jimblebar fines was the most sensitive: In early September 2025, the price spread between the two was 20 yuan/mt. As news of the ban on Jimblebar fines port cargo pick-up was released, its spot price came under pressure and dropped sharply, with the price spread quickly widening to around 50 yuan/mt. In addition, affected by the reduction in tradable varieties of mainstream Australian medium-grade ore, the variety price spreads between PB fines and Newman fines, as well as MAC fines, also showed a notable narrowing trend. Source: SMM ◼ High-Grade Premium Highlighted, Price Difference Between High and Medium-Grade Ore Widening Rapidly From Q4 2025 to date, price spread fluctuations among high, medium, and low-grade ore were equally intense. After entering 2026, structural contradictions in the iron ore market became further pronounced. Affected by declining raw ore quality from northern Brazilian mining areas, IOCJ fines supply experienced a trend of contraction. Coupled with the cost-effectiveness recovery brought by earlier price weakness and the release of concentrated restocking demand from steel mills ahead of Chinese New Year, IOCJ fines prices received strong support. Meanwhile, mainstream medium-grade ore remained tight in available resources due to trade flow disruptions. Against the backdrop of a shift between high and low-grade resources, the price difference between high and medium-grade ore widened again. Reviewing the period from November 2025 to March 2026, north China entered the heating season, and environmental protection-driven production restrictions became more frequent. As Chinese New Year and the Two Sessions approached, production restrictions were further tightened, with blast furnaces at steel mills in multiple areas of Hebei shut down, leading to a notable decline in hot metal production. Notably, during this period, steel mill profits remained generally stable, and some enterprises, in pursuit of higher output, tended to increase the blast furnace blending ratio of high and medium-grade ore while correspondingly reducing procurement of low-grade ore. Driven by this structural demand shift, the price difference between medium and low-grade ore widened. Source: SMM ◼ Lump-Fines Price Spread Experienced a "V"-Shaped Trend, Declining First Then Rising Since sintering processes generate relatively high pollution emissions, environmental protection-driven production restrictions typically prioritized restricting sintering and shaft furnace production. In north China and north-east China, during heating seasons or major events, if production restriction periods are prolonged, steel mills often increase the proportion of lump ore in their mix to alleviate tight supply of sinter and pellet, thereby driving lump ore prices to rise rapidly. However, over the past three years, the impact of seasonal factors on lump ore demand has gradually weakened, mainly for three reasons: first, steel mills have successively completed ultra-low emission retrofits for flue gas, reducing overall pollution intensity; second, sintering machines in Hebei and other regions have surplus capacity, and environmental protection-driven production restrictions have mostly been limited to within one week, significantly reducing the actual impact on production; third, steel mill profits have been under pressure, reducing the pursuit of hot metal production, and the proportion of high-grade ore usage has adjusted downward accordingly. Under the combined influence of the above factors, since H2 2024, lump ore premiums have continued to decline, hitting a new low by the end of 2025. Meanwhile, the price spread between PB lump and PB fines also narrowed significantly, contracting from 195 yuan/mt to 63 yuan/mt, a decline of over 50%. Against this backdrop, the cost-effectiveness of lump ore gradually became more prominent. Combined with the extended environmental protection-driven production restriction period in northern China in November 2025, the proportion of lump ore usage began to increase. However, as lump ore premiums had remained low for an extended period, product returns were poor, and major mines correspondingly reduced lump ore production. Driven by both supply contraction and demand growth, lump ore premiums rebounded, and the lump-fines price spread widened accordingly. As of mid-March 2026, lump ore premiums have risen to a periodic high, up nearly 280% from early January. The lump-fines price spread has also gradually widened to above 100 yuan/mt. Source: SMM Key Driving Logic of Product Price Spreads Mix Adjustment Led by Steel Mill Profits (Core Driver) ◼ 1 Profit Expansion Phase: High Hot Metal Production Drives Demand for High-Grade Ore When steel mill profits widened and per-mt crude steel returns were higher, steel mills pursued pig iron production and tended to raise the grade of furnace feed. When selecting iron ore, they preferred to purchase high-grade or medium-grade ore. As shown, in H1 2025, profits of common billet at China's steel mills rebounded notably. Common billet profits reached a peak of nearly 350 yuan/mt. At this point, to boost production, steel mills moderately increased the proportion of high-grade IOCJ fines, as well as high-grade lump and pellet usage. Demand growth over a certain period stimulated high-grade ore price increases, and it was clearly evident that the price spread between high-grade and medium-grade ore began to widen. Source: SMM ◼ 2 Profit Contraction Phase: Cost Reduction and Efficiency Improvement Boost Low-Grade Ore Procurement After steel mill profits contracted, to reduce costs and improve efficiency, steel mills significantly increased their focus on cost-effectiveness across iron ore products, tending to prioritize products with higher cost-effectiveness. Within the mid-grade ore range, steel mills preferred varieties with a larger price spread relative to PB fines. Meanwhile, weakening profits meant that higher pig iron or crude steel production led to greater loss pressure. Therefore, steel mills controlled pig iron production rationally from the perspective of economic efficiency. However, given the high comprehensive costs of shutting down or reducing blast furnace loads, steel mills tended to maintain normal blast furnace operations while lowering furnace charge grade and increasing the use of low-grade ore. Under these circumstances, assuming other conditions remained unchanged, the price spread between mid- and low-grade ore tended to narrow. Taking the market around October 2025 as an example, billet profits continued to decline, and the mid-to-low-grade ore price spread narrowed accordingly. Data source: SMM Dual Transmission Paths of Seasonal Effects ◼ Seasonal factors influenced iron ore variety demand through dual paths of "end-use demand fluctuations" and "heating season environmental protection-driven production restrictions" ◼ 1. Seasonal fluctuations in end-use demand: impact on steel mill production and raw material procurement pace The shift between off-season and peak season in end-use demand created cyclical impacts on iron ore variety demand. Off-seasons were mainly concentrated in summer (June–August) and winter (November–February): high temperatures and heavy rainfall in summer suppressed construction, while hydropower replacing thermal power in south China lowered electric furnace production costs and squeezed blast furnace hot metal production; in winter, construction sites in north China shut down and steel demand contracted. During off-seasons, steel mills increased blast furnace maintenance and lowered furnace charge grade to control production, with demand for high-grade iron ore weakening accordingly. During peak seasons (spring March–May, autumn September–October), downstream construction activity was released intensively, steel mills actively ramped up production, and furnace charge grade rose in tandem, strengthening demand for high-grade fines, lump ore, and pellet, supporting their premium performance. In summary, seasonal fluctuations in end-use demand drove cyclical changes in iron ore variety demand by influencing steel mill production and furnace charge grade selection. Transmission logic: end-use demand fluctuations → steel mill production adjustments → changes in total iron ore procurement volume → corresponding shifts in variety demand structure Data source: SMM Data source: SMM ◼ 2. Environmental protection-driven production restrictions during the northern heating season: direct disruption to furnace charge structure and variety premiums Heating season environmental protection-driven production restrictions primarily targeted steel mills in north China, spanning November to April of the following year . During this period, if air quality failed to meet standards, local environmental protection authorities would initiate production restriction measures, prioritizing restrictions on sintering machines and shaft furnaces, leading to tighter supply of sinter and pellet. To maintain blast furnace operations, steel mills were forced to increase the proportion of lump ore in their charge mix, driving a seasonal strengthening of lump ore demand, which in turn supported lump ore premiums and a rise in the lump-fines price spread. Transmission logic: environmental protection policy → sinter machine production restrictions → forced adjustment of furnace charge structure → stronger demand for lump ore and pellet ore → premium fluctuations Data source: SMM Coke prices affected the iron ore product mix through dual channels of fuel costs and profit margins ◼ 1 High coke prices suppressed lump ore demand As raw material directly charged into furnaces, lump ore consumed more coke than sinter and pellet ore, so steel mills typically controlled the lump ore charging ratio at around 10%. During periods when coke prices fluctuated at highs, steel mills tended to reduce lump ore proportions to control fuel costs. Before H1 2024, coke prices fluctuated at highs, and the lump ore usage ratio continued to decline, falling to a low of 9.8%. However, as coke prices underwent nearly a year of decline and entered a low range, combined with relatively low lump ore premiums and the push from environmental protection-driven production restriction policies, the lump ore charging ratio gradually rebounded, once exceeding 11%. Data source: SMM ◼ 2 Demand for high-silicon fines suppressed The higher the silicon content in iron ore, the greater the blast furnace slag volume and the higher the coke ratio. Therefore, low-silicon smelting is a key direction for blast furnace process optimization and a critical lever for cost reduction and efficiency improvement. Among current iron ore products on the market, mainstream mid-grade ore Si content mostly ranges from 4-6%. Brazilian high-silicon BRBF has relatively high Si content at 10-12%. Therefore, Australian ore is mostly used as the primary material, while Brazilian ore and non-mainstream ore serve as auxiliary materials. When coke prices were at highs, the cost disadvantage of high-silicon resources became prominent, and steel mills tended to reduce Brazilian high-silicon BRBF, Indian fines, and South African fines, shifting to mid-to-high-grade fines with lower silicon content (such as PB fines and IOCJ fines). Going forward, the iron ore oversupply pattern will become more prominent, while under overcapacity pressure in China's steel sector, steel mill profits will remain poor. Therefore, cost reduction and efficiency improvement will be a long-term direction, driving stronger demand for low-silicon, low-aluminum products. Consequently, mainstream mid-grade ore will remain the product with the best market circulation. Data source: SMM ◼ 3 Rising share of mid-to-low-grade fines under low profits High coke and ore prices squeezed steel mill profits, and steel mills no longer pursued hot metal production maximization, instead increasing mid-to-low-grade fines usage and lowering charging grade to control costs. Based on historical data, such situations occurred in Q3 2024 and Q2 2025. Auxiliary Variables: Inventory, Substitution, and Preferences ◼ 1 Product substitution effect: mid-grade inter-substitution and "high-low blending" substitution In the product mix of steel mill sinter, "high-low blending" and "mid-grade blending" are commonly mentioned concepts, with the core principle being to select the optimal products based on the cost-effectiveness of different iron ore varieties. Under normal circumstances, steel mills use MNPJ (i.e., mainstream medium-grade ore types such as Mac fines, Newman fines, PB fines, and Jimblebar fines) as primary materials, or adopt a high-low grade combination of " IOCJ fines + super special fines " as primary materials, and adjust auxiliary material ratios based on the acidity and alkalinity of the primary materials. Using mainstream medium-grade ore types as primary materials is the more common practice. When mainstream medium-grade ore types are periodically less cost-effective — for example, when the combined cost of "IOCJ fines + super special fines" is lower than that of medium-grade PB fines — some steel mills periodically switch to high-low grade combinations as primary materials to reduce costs. As shown in the chart, during March to April of 2024 and 2025, the cost-effectiveness advantage of high-low grade combinations was significantly superior to that of medium-grade ore, and therefore some steel mills in regions such as Hebei and Shanxi predominantly chose high-low grade combinations as primary materials during these periods. Data source: SMM ◼ 2. Inventory Structure Drives Price Spreads among Varieties: Inventory Changes and Price Transmission Logic Inventory is the most intuitive reflection of short-term supply-demand imbalances in the iron ore market. When supply is loose or demand weakens, port inventory continues to rise, and inventory levels generally exhibit a negative correlation with prices. Once inventory accumulates to a certain level, it tends to exert significant downward pressure on prices. Over the past two years, the inventory and price trends of Ukrainian concentrate (hereinafter "Ukrainian concentrate") have well validated this pattern. In November 2023, Ukrainian concentrate shipments gradually resumed, but as steel mills still had concerns about the stability of its supply, actual usage did not increase significantly, leading to continued port inventory accumulation. By May 2024, SMM ten-port inventory data by variety showed that Ukrainian concentrate inventory exceeded 3 million mt , exerting significant downward pressure on prices, with Ukrainian concentrate prices falling from 1,200 yuan/mt at the beginning of the year to 900 yuan/mt. Meanwhile, the price spread between Ukrainian concentrate and PB fines also narrowed from 160 yuan/mt to 80 yuan/mt, and its cost-effectiveness advantage gradually emerged, driving a notable increase in steel mill demand. Entering early 2026, affected by a decline in Ukrainian concentrate supply, port inventory retreated from highs to around 1.1 million mt, and tightening supply supported a notable rebound in Ukrainian concentrate prices, with the price spread versus PB fines also widening from 80 yuan/mt to around 100 yuan/mt . Data source: SMM Variety Cost-Effectiveness Assessment Model and Selection Strategy ◼ 1. Horizontal Comparison: Micro-Indicator Assessment among Same-Grade Varieties. In recent years, global mainstream iron ore supply entered a resource transition period, with notable structural adjustment characteristics. On one hand, some aging mines faced resource depletion , with declining mining grades; on the other hand, new mines were still in the capacity ramp-up stage , and the transition between old and new resources still required time. As a result, quality indicators of multiple mainstream varieties were broadly downgraded. Among them, medium-grade ore indicators represented by PB fines and Newman fines weakened; due to declining raw ore quality in Brazil's northern system, not only did IOCJ fines production contract, but the proportion of high-silicon special IOCJ fines output also rose, with silicon content increase being particularly notable beyond the decline in iron grade. Against this backdrop, steel mills tended to assess the most cost-effective varieties by calculating comprehensive price spreads. From the perspective of minor indicator adjustment values, the smaller the adjusted price spread relative to the MMI 61% index, the better the variety met steel mill demand. Based on Q1 averages, Jimblebar fines offered the best cost-effectiveness, followed by PB fines, Mac fines, Newman fines, and BRBR. However, since Jimblebar fines could not be traded or delivered, PB fines remained the optimal choice among medium-grade ores. Data source: SMM ◼ 2. Vertical Comparison: Historical Percentile Timing of High, Medium, and Low-Grade Price Spreads Beyond the horizontal comparison of price spreads among varieties of similar grades, vertically examining price spread changes among high, medium, and low-grade ores was equally important. By analyzing historical percentiles of the price difference between high and medium-grade ore and the price difference between medium and low-grade ore, the relative valuation of each grade could be assessed to guide variety switching and timing. Price difference between high and medium-grade ore: when at historical highs, the high-grade premium was excessive, and switching to medium-grade was advisable under profit pressure; when at historical lows, high-grade cost-effectiveness stood out, and moderate allocation increases were appropriate. Beyond premiums, using IOCJ fines and PB fines as benchmarks and calculating based on their indicator costs, the neutral value of the price spread between the two was 100 yuan/mt. When the spread exceeded 100 yuan/mt, PB fines offered better cost-effectiveness; when below 100 yuan/mt, IOCJ fines were more cost-effective. Price difference between medium and low-grade ore: when at historical highs, low-grade advantages were evident, suitable for cost reduction during thin-margin periods; when at historical lows, medium-grade cost-effectiveness improved, allowing flexible adjustments. Using PB fines and SSF as benchmarks and calculating based on their indicator costs, the price spread between the two ranged from 100-120 yuan/mt, with a midpoint of 110 as the neutral value. When the spread exceeded 110 yuan/mt, super special fines offered better cost-effectiveness; when below 110 yuan/mt, PB fines were more cost-effective. Combining the historical percentiles of both, allocation windows for each grade could be captured based on profit cycles to achieve cost optimization. Data source: SMM ◼ 3 Morphology Comparison: Arbitrage Logic of Fines-Lump Price Spread and Lump Ore Premium. Taking the price spread between PB lump and PB fines as an example, influenced by steel mill profits and coke prices, the fines-lump price spread exhibited notable fluctuations. Historical data showed the price spread between PB lump and PB fines ranged approximately 80–500 yuan/mt. In H1 2021, driven by high steel mill profits and supply-demand mismatch, the fines-lump price spread once approached the historical high of nearly 500 yuan/mt. In recent years, as steel mill profits narrowed, the price spread contracted significantly. In 2025, the fines-lump price spread operated within a range of 70–220 yuan/mt, with an annual average of approximately 128 yuan/mt. In early 2026, the lump ore premium fell to $0.04/dmt, and the price spread narrowed to 65 yuan/mt. Given that China's overcapacity landscape has not fundamentally changed, steel mill profits are expected to remain basically flat with 2025, and the fines-lump price spread is likely to maintain the current range. Based on this assessment: When the lump-fines price spread exceeds 120 yuan/mt, PB fines offer better value; When the lump-fines price spread falls below 120 yuan/mt, PB lump offers better value. Steel mills can choose accordingly based on their own conditions. Data source: SMM ◼ 4 Substitution Comparison: Cost-Effectiveness Competition between Lump Ore and Pellet Generally, when steel mill profits are favourable, steel mills consider increasing the usage ratio of lump ore and pellet. Typically, the combined usage share of lump ore and pellet ranges between 20%–30%. In actual ore blending decisions, steel mills' price spread analysis between lump ore and pellet falls into two categories: inland steel mills usually compare the price spread between domestic pellet and lump ore such as PB lump and Newman lump; while coastal port steel mills focus more on the price spread between imported pellet and corresponding lump ore. In recent years, with the increase in China's pellet capacity and the decline in imported pellet volumes, the weighting of price spread comparison between same-grade lump ore and domestic pellet has further increased. Historical data showed the price spread between 62% grade pellet in Qingdao and PB lump ore at Qingdao port ranged approximately 40–260 yuan/mt, with an annual average price spread of approximately 108 yuan/mt in 2025. Considering steel mills' actual cost accounting, the price spread equilibrium point between pellet and lump ore is generally set at 120 yuan/mt. When the pellet-lump price spread exceeds 120 yuan/mt, lump ore offers better value; When the pellet-lump price spread falls below 120 yuan/mt, pellet offers better value. Steel mills can choose accordingly based on their own raw material conditions, logistics structure, and production requirements. Data source: SMM Carbon Neutrality as a Two-Way Driver: Steel Industry Restructuring Shifts Iron Ore Demand ◼ The rapid advancement of industrialisation has significantly intensified the impact on the global climate, making the urgency of achieving carbon neutrality increasingly pressing. Particularly over the past five years, major economies represented by China and the EU have not only defined their respective emission reduction targets but also successively introduced legally binding regulations, marking a shift in global climate governance from consensus to action. Going forward, China's Ecological Environment Code and the EU's European Climate Law and "Fit for 55" package will become the two major institutional benchmarks for global climate governance. China's carbon market and the EU's CBAM, from the two dimensions of domestic carbon pricing and cross-border carbon adjustment respectively, form core policy tools for effectively controlling carbon emissions. Source: SMM ◼ Driven by both domestic and international legislation, the steel industry will undergo an evolution in emission reduction pathways: process transformation from long-process to short-process steelmaking; low-carbon transition driving non-blast furnace ironmaking development and carbon constraints driving furnace charge structure upgrades. These pathways will collectively reshape the demand structure of iron ore, manifested as strengthened preference for high-grade, low-impurity iron ore concentrates and premium mainstream ore types, while demand for traditional sintering fines tends to narrow. ◼ 1. Process restructuring: the shift from long-process to short-process steelmaking will drive increased demand for mainstream varieties and high-grade ore Under the global backdrop of "carbon neutrality" goals, the steel industry is regarded as one of the key areas for industrial emission reduction. The traditional long process (blast furnace-converter process), due to its reliance on coke and iron ore, is considered a major source of high carbon emissions and has become a key target for regulation and transformation. Many countries have begun shifting toward the more environmentally friendly short process (steel scrap-electric furnace process), but this transition has been relatively slow in China. On one hand, electric furnace steelmaking is largely limited to rebar production; on the other hand, steel scrap supply is constrained. Additionally, considering factors such as melting costs and losses in steel scrap smelting, pig iron costs should be higher than steel scrap prices by 100-150 yuan/mt for steel scrap to be more cost-effective; if the price spread is below this level, pig iron offers better value. In 2025, the price spread between hot metal costs and steel scrap fluctuated in a range of -100-210. Pig iron costs were mostly more favorable than steel scrap, so the share of blast furnace steelmaking in China stayed high. Source: SMM In China, apart from profitability, short-process electric furnaces are also constrained by high electricity prices, steel scrap price fluctuations, and cost disadvantages , resulting in slow capacity growth. Although the national carbon market is already operational, current carbon prices have not been effectively incorporated into trading, which is not enough to drive a large-scale shift from long-process to electric furnaces, and enterprises mostly adopt gradual adjustments . Source: SMM Based on current policy and market conditions, before China's steel industry is formally included in the national carbon market trading and during the early stage of the EU's CBAM policy implementation, the blast furnace-converter long process will remain the dominant mode of global steel production over the next five years. However, under the dual pressures of domestic steel capacity capping and rising carbon prices in the future, China's electric furnace short process is entering a historic development opportunity, with its share of steelmaking set to gradually increase. By 2030, the share of electric furnace steelmaking is expected to reach around 35%. In the long term, this trend will gradually suppress iron ore demand, causing it to weaken. Against the backdrop of oversupply, competition among iron ore varieties will intensify, and therefore high cost-effective varieties with low silicon and aluminum content will become the optimal choice for steel mills. Undoubtedly, mainstream medium and high-grade ore such as PB fines, Mac fines, Newman fines, IOCJ fines, BRBF, and Simandou fines all belong to relatively high-quality varieties. ◼ 2 Low-carbon transition driving non-blast furnace ironmaking development, demand for high-grade iron ore concentrates with Fe content above 65% expected to continue rising Currently, global DRI production accounts for only 10% of total global production. As low-carbon technologies such as hydrogen-based DRI accelerate in application, DRI production share is expected to rise to 13% by 2030. In comparison, China's non-blast furnace ironmaking share is even smaller, with mass production not yet achieved and only leading steel enterprises in the trial production stage. Under current carbon neutrality requirements, China's non-blast furnace ironmaking is facing significant development opportunities. According to incomplete statistics, announced non-blast furnace ironmaking capacity totaled approximately 18 million mt, of which only 2 million mt were under construction, with the remaining 16 million mt of projects still in early stages, carrying relatively high risk coefficients. Whether these projects materialize depends on multiple factors including funding, market conditions, decarbonization policies, and government support, resulting in significant uncertainty regarding future commissioning time. Future projects will primarily be gas-based; current major DRI equipment uses coke oven gas (COG), but in the medium and long-term will gradually shift to green hydrogen. Data source: World Steel Association Data source: SMM Currently, the core requirements for DRI raw materials are "high grade, low impurities," with Fe grade ≥66% and SiO2+Al2O3 ≤3.5%. China's concentrates generally have relatively high silicon content, with some exceeding 10%. Therefore, only a few low-silicon concentrates can be used to produce direct reduced pellet feed. Ex-China high-grade concentrates offer a wider range of options. Data source: SMM As DRI production grows, demand for high-quality iron units is also increasing, leading to a structural rise in the share of high-grade iron ore and pure iron raw materials. As shown in the chart, varieties within the red box all have Fe content above 66%, with Si+Al content around 3.5%; these include some high-grade iron ore concentrates from China, Brazilian pellet feed concentrates, Peruvian concentrates, and emerging Simandou fines, all of which can serve as DRI raw materials. Data source: SMM ◼ 3. Carbon constraints drive furnace charge structure upgrades, with pellet replacing sinter becoming key to carbon reduction, and pellet-making concentrates with grades above 62% set to see significant growth. As China's steel industry pursues structural adjustment, optimization, and green, low-carbon, high-quality development, pellet ore as a premium raw material for blast furnaces has been increasingly favoured by the industry, driving the rapid development of the pellet sector. The energy consumption of the pellet production process is approximately 50% of that of the sinter production process. According to CISA's 2025 statistics, the average energy consumption of the sintering process among its member units was 48.5 kg/mt, while the average energy consumption of the pellet process was 25.23 kg/mt, indicating lower energy consumption in pellet production. Due to the different heat supply methods in pellet roasting compared to sintering, SO2, NOX, and CO2 emissions after combustion are much lower than those from the sintering process. In addition, pellet ore generates much less dust than sinter, making the pellet process more environmentally friendly. The emission comparison between the sintering process and the pellet process is shown in the chart below: Data source: SMM ◼ A high proportion of pellet ore in furnace charge is the direction and demand of current blast furnace charge structure development Compared with other countries in the world, China's blast furnace charge structure is dominated by sinter with a low pellet ratio , while blast furnaces in North America and Europe primarily use high proportions of pellets, with some blast furnaces reaching 100%. For example: SSAB's blast furnace in Sweden had a pellet ratio of 97.2%, Dofasco in Canada achieved 100% all-pellet smelting, and USS No. 14 blast furnace had a pellet ratio of 80%, etc. According to CISA's 2025 statistics, the average fuel ratio per unit of ironmaking at China's key steel enterprises was 523-525 kg/mt, approximately 70 kg higher than the average fuel ratio of European and American blast furnaces. The reason is that China's blast furnace charge is dominated by sinter, with sinter iron grade at around 54-57%, while pellet ore iron grade is above 62%. High sinter usage leads to high slag volume and high energy consumption in blast furnaces. Therefore, against the backdrop of carbon reduction, increasing the proportion of pellet ore usage is imperative. Data source: SMM ◼ Currently, there are three main types of pellet production equipment in China: shaft furnaces, chain grate-rotary kilns, and travelling grates . In recent years, pellet equipment with a single-unit capacity below 1.2 million mt/year (excluding ferroalloy and foundry pig iron pellets) has been classified as a restricted category; therefore, capacity replacement of pellet equipment continues, with new pellet projects predominantly using travelling grates, with single production line capacity mostly at 5 million mt. As a result, current pellet production is mainly based on rotary kilns and travelling grates. These two types of equipment have less stringent raw material requirements compared to shaft furnaces, allowing the blending of multiple ore types such as magnetite, hematite, and limonite. However, it must be concentrate, with a particle size requirement generally of -200 mesh, 70% or above. Commonly used varieties include: domestic concentrate, Ukrainian concentrate, Brazilian concentrate, Middle Eastern concentrate, Chilean concentrate, Australian concentrate, Sierra Leonean concentrate, etc. As the proportion of pellet usage increases in the future, demand for concentrate with grades of 62% and above will continue to expand. ◼ Overall, before 2030, as carbon neutrality policies and Europe's CBAM are still in the early stages of implementation, carbon emission costs have not yet become significantly prominent. Meanwhile, China's steel production is trending downward, while iron ore supply is accelerating, steel mill profits are under pressure, and cost reduction and efficiency improvement remain the industry's mainstream strategy. Therefore, procurement will continue to focus on low- and medium-grade iron ore, demand for non-mainstream ore varieties will remain robust, the price spread among high-, medium-, and low-grade ore will be difficult to widen, and premiums for lump ore and pellets will also stay at current low levels. ◼ After 2030, market requirements for green steel will gradually increase, the share of electric furnace steelmaking and non-blast furnace steelmaking will rise, and overall iron ore demand will decline notably. Although blast furnace capacity will decrease, operating rates may improve, driving down sinter demand while pellet demand increases significantly. This shift will lead to a sharp decline in fines demand and an expansion of market share for mainstream medium-grade ore; meanwhile, demand for high-quality concentrate will rise, pushing the price difference between high and medium-grade ore wider, and pellet premiums will also continue to climb. Additionally, although lump ore demand has some growth potential, the increase will be limited under carbon emission constraints, and lump ore premium elasticity will diminish accordingly.

SMM Morning Meeting Summary: Overnight, LME copper opened at $13,317/mt, moved sideways after the opening before dipping to a low of $13,168/mt, then the center rose to a high of $13,348/mt, and finally closed at $13,259/mt, down 0.68%, with trading volume at 18,000 lots, a decrease of 809 lots from the previous trading day; open interest stood at 316,000 lots, a decrease of 4,795 lots from the previous trading day, with the overall movement mainly characterized by bulls reducing positions. Overnight, the most-traded SHFE copper 2604 contract opened at 102,670 yuan/mt, fluctuated downward after the opening to a low of 101,780 yuan/mt, then the center rose to a high of 102,880 yuan/mt, and finally closed at 102,550 yuan/mt, down 0.15%, with trading volume at 55,000 lots, a decrease of 51,000 lots from the previous trading day; open interest stood at 186,000 lots, an increase of 1,437 lots from the previous trading day, with the overall movement mainly characterized by bears adding positions.

Teck Resources warned that rising diesel and freight costs could increase spending at its Chilean copper mining operations during Q2, as global supply tightened. The Canadian mining company said its Chilean operations relied on imported diesel and faced higher fuel and transportation costs due to supply disruptions related to the Strait of Hormuz, although no severe shortages were expected. "We expect freight costs to continue rising in Q2 2026, with explosives costs also increasing accordingly. We will continue to closely monitor developments, such as potential product export bans by major supplying countries, which could further disrupt the market," the company said. The warning highlighted broader supply chain pressures and the risk that government intervention could tighten metals markets, potentially prompting enterprises and strategic stockpiling of copper and zinc as demand strengthened. Alongside the cost warning, the company reported strong Q1 results that exceeded analyst expectations. This was primarily driven by higher copper prices, record sales, and increased production at its flagship mine, Quebrada Blanca (QB), in northern Chile. Production at the newly expanded mine grew 31.2% to 55,500 mt, compared with just 42,300 mt a year earlier when output was constrained by prolonged shutdowns. Despite a maintenance shutdown at the start of the year, performance remained on par with the previous quarter. Total copper production in Q1 reached 140,000 mt, compared with 106,100 mt in the same period last year. The company still plans to produce 455,000 to 530,000 mt in 2026 and 505,000 to 580,000 mt in 2027, while 2025 production is expected to be 453,500 mt, with the QB project expected to contribute 200,000 to 235,000 mt next year. Driven by growing power demand from data centers, artificial intelligence, and national defense, as well as expanding investment in power grid and electronic infrastructure, global copper demand is expected to surge 50% by 2040, benefiting Teck and its peers. Concentrates zinc production fell to 120,300 mt, a decrease of 17,000 mt from the same period last year. (Wenhua Consolidated)

On April 23 (Thursday), the International Copper Study Group (ICSG) stated that the global copper cathode market is expected to shift to an oversupply of approximately 96,000 mt in 2026, reversing the previously forecast supply deficit of 150,000 mt, due to slowing demand growth and increased secondary copper production. The organization also forecast that the copper cathode surplus will widen to 377,000 mt in 2027, but warned that geopolitical risks including wars in the Middle East and shifts in trade flows could impact the market's supply-demand balance. ICSG expects global copper cathode consumption to grow 1.6% in 2026, down from the previous estimate of 2.1%, with consumption growth of 2% projected for 2027. China's copper demand is expected to grow 1.9% in 2026, while demand growth in other regions is projected at 1.3%. ICSG added that copper consumption in the EU and Japan will remain subdued, while Asia will continue to be the primary driver of global demand growth. In terms of supply, global copper cathode production is expected to increase only 0.4% in 2026, mainly constrained by limited copper concentrates supply, though increased secondary copper production will partially offset this constraint; with higher copper concentrates production and new capacity coming online, copper cathode production growth is expected to accelerate to 3% in 2027. ICSG stated that global copper ore production is expected to grow 1.6% in 2026, down from the previously forecast 2.3%, due to slower production growth in the DRC, Chile, and Indonesia, as well as operational constraints at the Grasberg and Kamoa mines following issues in 2025. The organization expects global copper ore production to grow 2.3% in 2027, supported by the gradual ramp-up of new capacity, improved production in Chile and Zambia, and higher mine utilization rates in Indonesia and the DRC. (Webstock Inc.)

BHP Group announced in its earnings report on Wednesday that annual copper production will reach the upper half of its guidance range. The company stated that due to weak performance at its Escondida and Pampa Norte copper mine operations in Chile, Q3 copper production fell 7% YoY to 476,800 mt, below expectations of 479,200 mt. Among them, Escondida copper mine production was 303,200 mt, down 9% YoY; Pampa Norte copper mine production was 44,600 mt, down 34% YoY. For fiscal year 2026 year-to-date (through month-end March), copper production was 1.4609 million mt, down 3% from the previous fiscal year. The company stated that annual copper production is expected to reach the upper half of the guidance range of 1.9-2 million mt. Below are the production details: (unit: kt) (Wenhua Composite)

According to data from the online query platform of the General Administration of Customs, China's imports of copper ore and concentrates in March 2026 totaled 2,629,996.23 mt, up 13.84% MoM and 9.99% YoY. Shipments from major supplying countries such as Chile, Peru, and Mongolia all increased to varying degrees. However, spot copper concentrate TCs in China remained at low levels, and the tight ore supply situation continued. Below is the supply breakdown from major source countries for China's copper ore imports since March 2020: Data source: General Administration of Customs (Wenhua Composite)

SMM Analysis: According to data from the General Administration of Customs, China imported 68,800 mt of copper anode (HS code: 74020000) in March 2026, up 20.97% MoM and up 37.10% YoY...