According to an announcement by Ivanhoe Mines, the Kamoa-Kakula project aims to achieve copper production of 380,000 to 420,000 tonnes in 2026 and 500,000 to 540,000 tonnes in 2027, with the medium-term copper production target maintained at 550,000 tonnes. In terms of recent progress, the dewatering efforts at the Kakula mine are proceeding smoothly (70% completion on the west side and 60% on the east side), laying the groundwork for resuming production. As dewatering advances, mining in the higher-grade (3.5%–4.0%) central area will commence in mid-December, which is expected to drive overall output and profitability. At the Kakula mine, approximately 6 million tonnes of ore are planned to be mined in 2026, primarily from the west side, with production increasing to 7–8 million tonnes in 2027. At the Kamoa mine, the focus will shift from supplying primarily the Phase I and II concentrators to prioritizing supply for the Phase III concentrator, while also supplementing Phase I and II. Mining output is expected to rise from the current 6.5 million tonnes per year to over 10 million tonnes per year by 2027. The total processing capacity of the Phase I, II, and III concentrators will reach 17 million tonnes per year starting in 2027. Additionally, following the announcement of the commissioning of the Kamoa-Kakula copper smelter on December 1, 2025, copper sales in 2026 are projected to exceed copper production, as on-site inventories of unsold copper concentrate are expected

SMM Morning Meeting Summary: Overnight, LME copper opened at $9,686.5/mt, rose initially and hit a high of $9,713/mt, then fluctuated downward and touched a low of $9,647.5/mt. It rebounded slightly at the end of the session and closed at $9,670/mt, down 0.26%. Trading volume reached 13,000 lots, and open interest reached 293,000 lots. Overnight, the most-traded SHFE copper 2507 contract opened at 78,600 yuan/mt, hit a high of 78,690 yuan/mt at the beginning of the session, then fluctuated downward and touched a low of 78,360 yuan/mt during the session. It rebounded all the way at the end of the session and closed at 78,560 yuan/mt, up 0.04%. Trading volume reached 20,000 lots, and open interest reached 182,000 lots.

According to a report by Mining.com, Ivanhoe Mines announced that its Kakula West copper mine in the Democratic Republic of Congo (DRC) has resumed production after a temporary suspension lasting one month. This underground mine is part of the company's Kamoa-Kakula copper joint venture. On May 18, the mine was forced to suspend production due to severe water inflow caused by seismic activity in the region. The Kamoa-Kakula joint venture is Africa's largest copper mine, with Ivanhoe holding a 39.6% stake. Analysts believe that once the necessary pumping and repair work is completed, the mine should be able to resume production. Mining activities in the eastern section are also expected to commence immediately, with a focus on advancing from existing stopes to new areas. In a statement, Robert Friedland, the company's Executive Chairman, said, "We are grateful and thankful to our team for their rapid response in stabilizing the water table at Kakula and resuming mining on the west side." "The team quickly secured the critical equipment needed to remove water from the entire mine, while also preparing to mine a high-grade area in the east." With the resumption of production at the Kakula copper mine, Ivanhoe has set new production targets for the Kamoa-Kakula joint venture in 2025: 370,000 to 420,000 mt of copper concentrates. Based on the midpoint, this projection represents a 28% decrease from the previous production target set in January (520,000 to 580,000 mt). Ivanhoe stated that the downward revision in production expectations takes into account the potential impact of recent seismic activity and related disruptions at the Kakula mine. Several risk factors, such as further seismic activity and infrastructure damage, were also highlighted as considerations. Additionally, the company's management has withdrawn the production target of approximately 600,000 mt for 2026, pending further evaluation. Friedland emphasized, "Although it is premature to establish production plans for 2026 and 2027, the future of the Kamoa-Kakula joint venture remains bright." As previously disclosed, the Phase 1 and Phase 2 beneficiation plants at Kakula are still operating at half of their capacity, processing surface ore inventory. The beneficiation plants are expected to restore their capacity for the remainder of the year as mining volumes increase in the western section of the mine, according to Ivanhoe. Meanwhile, the Kamoa underground mine, as well as the adjacent Phase 3 beneficiation plant, are operating well. With the necessary copper concentrate supply in place, the on-site smelter is expected to commence operations in September, with the first products to be produced in October 2025.

According to foreign media reports, Ivanhoe Mines announced that it had resumed production at the western part of the Kakula copper mine in the Democratic Republic of Congo (DRC). The underground mine is part of the Kamoa-Kakula copper mine complex. On May 18, the mine was forced to suspend production due to severe water inflow caused by seismic activity in the region. The Kamoa-Kakula copper mine complex is the largest copper mine in Africa, and Ivanhoe holds a 39.6% stake in the mine.

[SMM Analysis: When It Rains, It Pours - Global Copper Concentrates Supply-Demand Balance After the Earthquake at KK Mine] At the end of May, Chinese smelters and Antofagasta commenced mid-year negotiations. In the first round of negotiations this year, miners had already offered a midpoint price of -US$15 to the smelters. This figure was significantly lower than the US$0/dmt that had circulated in the market in late April. According to SMM, many raw material procurement teams from leading smelters in the CSPT group indicated that the negotiations were fraught with difficulties, and it was exceptionally challenging to secure a favorable figure.

According to Ivanhoe Mines: Robert Friedland, Executive Co-Chairman of Ivanhoe Mines (TSX: IVN; OTCQX: IVPAF), Weibao Hao, Co-Chairman, and Marna Cloete, President and Chief Executive Officer, announced today the latest operational updates for the Kamoa-Kakula copper mine project, as well as the preliminary findings of the geotechnical investigation following the seismic event at the Kakula mine announced on May 20, 2025. Mining operations in the western section of the Kakula mine were safely and prudently restarted on June 7, 2025, with equipment and mining crews returning underground to resume production. The short-term mining plan for the western section of the Kakula mine has been updated to incorporate the recommendations summarized in the preliminary investigation report. It is expected that mining operations in the far eastern section of the Kakula mine will also resume as soon as possible, with a focus on development work to open up access to new mining areas east of the existing mining zones. The development work in the new mining areas of the far eastern section of the Kakula mine will be carried out in a spatially isolated manner from the pumping work areas and is expected to be completed in the second quarter of 2026. On June 2, 2025, the company announced that additional pumping equipment had been installed at the Kakula mine to maintain stable water levels. Since the initial announcement on May 18, 2025, the frequency of seismic events has also decreased. Pumping operations are expected to commence in the eastern section of the Kakula mine in August 2025 and be completed in the fourth quarter. The recommendations made by world-class geotechnical experts based on the preliminary investigation findings have been incorporated into the short-term mining plan for the Kakula mine to ensure the safe restart of mining operations. Meanwhile, the management and technical advisors of Kamoa-Kakula are developing and reviewing the medium- and long-term mining plans for the mine. The Phase 1 and Phase 2 beneficiation plants continue to operate at approximately 50% of their combined capacity, processing ore from surface stockpiles. With the resumption of mining operations in the western section of the Kakula mine, ore supply to the beneficiation plants will increase, and the Phase 1 and Phase 2 beneficiation plants will gradually ramp up production over the remainder of 2025, with ore supply supplemented by ore mined from the western section of Kakula. Mining activities at the Kamoa underground mine and the adjacent Phase 3 beneficiation plant continue to operate normally without any disruptions. It is expected that the smelter located on the mine site will commence operations in September 2025 and produce its first copper anodes in October, once copper concentrate production and inventory levels meet the required conditions. Robert Friedland, Executive Co-Chairman of Ivanhoe Mines, commented, "We are grateful and deeply appreciate the swift response of the on-site team in stabilizing the groundwater levels at the Kakula mine and resuming mining operations in the western section. Critical dewatering equipment required to ensure the safety of the entire mine was rapidly deployed, while preparations were actively underway to advance as quickly as possible into the Kakula Far East zone to open up new high-grade mining areas." "Although it is still too early to outline detailed plans for 2026 and 2027, the prospects for the Kamoa-Kakula copper mine and the adjacent Western Foreland exploration project remain bright. Kamoa-Kakula is, and will continue to be, a world-class mine, maintaining its leading position among the world's copper producers for decades to come." President and CEO, Mark Cutifani, commented: "We are working tirelessly to safely and methodically restore full operations at the Kakula mine, with safety as our top priority! We would like to express our sincere gratitude to the mining team, engineering team, and our many long-standing contractors for their outstanding contributions in restoring dewatering capacity and restarting mining operations, all without any lost-time incidents." "The resilience and operational strength demonstrated by our team underscore the extraordinary nature of this world-class copper district – and the bright future it will create for generations to come." Note: Existing underground development as of May 2025. The above figure, based on the 2023 Kamoa-Kakula Integrated Development Plan, shows the average grade estimates (calculated using a cut-off grade of total copper >3%) for vertical blocks in different zones, with a minimum thickness of 3 meters. The groundwater level at the Kakula mine has stabilized; underground mining operations have resumed in the western section of the Kakula mine. Following the seismic event, although the inflow of water into the Kakula mine's underground workings gradually increased, it has now stabilized at approximately 4,000 liters per second. Due to the impact of the seismic event on existing underground dewatering facilities, additional underground dewatering capacity totaling approximately 4,400 liters per second has been installed, helping to stabilize the groundwater level. The new pumping stations are connected to the existing central dewatering infrastructure and then discharge water to the surface through four locations near the bottom of the northern and southern twin declines, as shown in Figure 2. With the stabilization of the water level, mining operations have resumed on the western side of the Kakula mine. Mobile equipment and mining crews, which were evacuated from underground on May 18, 2025, have now returned to the underground workings and conducted their first blast on June 7, 2025. The short-term mining plan has been updated to incorporate recommendations from the preliminary geotechnical investigation report. Based on underground conditions, Kamoa-Kakula's mining crews plan to increase mining volumes on the western side of the Kakula mine to approximately 300,000 mt per month (or 3.6 million mt per year on an annualized basis) in H2 2025. In Q3, mining operations will ramp up the mining capacity in the Kakula West Zone to 3.6 million mt/year, with further adjustments to be made based on underground conditions. In H2 2025, the underground mining team will focus on implementing three major projects: ramping up the mining capacity in the Kakula West Zone, constructing a new mining area in the Far East Zone of the Kakula Mine, and ramping up the mining capacity in the Kamoa Mining Area. Additional operational personnel have been deployed to the Kamoa Mine, located approximately 10 kilometers north of the Kakula Mine, to assist the existing mining team in underground excavation works, as well as in the construction of newly designed box-cut and ramp development at the Kansoko Mine. The new ramp will help increase the mining capacity at Kansoko and further supplement the ore supply required by the Phase 1 and Phase 2 beneficiation plants. Construction of the new mining area in the Far East Zone of the Kakula Mine will be concentrated, with development works set to commence soon, spatially separated from the pumping work area. The Far East Zone of the Kakula Mine will adopt a new mining plan, focusing on development works further east of the existing mining area. The new mining area and the existing mining area will be separated by a safety pillar to prevent the rock mechanics instability in the existing mining area from propagating to the new mining area. The mining team is expected to soon commence construction of two new main access tunnels. The two main tunnels will be constructed simultaneously, advancing eastward from the existing underground infrastructure (see Figure 2). The construction of the new mining area will involve the extraction of ore and waste rock, and is expected to be completed by Q2 2026. The new access tunnels will be isolated from the mining faces currently being dewatered, and dewatering operations will also be conducted separately and independently. Upon completion of dewatering in the East Zone of the Kakula Mine, in-situ geotechnical observations will be conducted in the existing mining area, followed by a comprehensive evaluation by geotechnical experts. The evaluation results will determine the future scope of production resumptions in the existing mining area. Underground water inflow is mainly concentrated in the deepest part of the East Zone of the mine (see Figure 2). The Kamoa-Kakula engineering team has developed a phased plan for dewatering the Kakula Mine. Phase 1 : Install temporary pumping facilities underground to maintain the existing water level stable. Phase 1 was completed on June 2, 2025. Phase 2 : Install large-power pumps and a permanent pumping system that can be operated from the surface to conduct comprehensive dewatering operations throughout the Kakula Mine. Kamoa Copper has ordered five large-power pumping units, each with a dewatering capacity of 650 liters per second. The long-term plan also includes the procurement of additional pumping units, which will be deployed in pairs in the existing shafts to the bottom of the Kakula Mine (see Figure 2). Dewatering is expected to commence in August 2025. As water levels gradually decline, the engineering team will begin repairing the underground pumping, ventilation, and other systems, and complete the geotechnical engineering assessment. It is expected that the dewatering work in the eastern section of the Kakula Mine will be completed in Q4. Preliminary findings from the recent geotechnical investigation into the mine seismicity Following the first mine seismic event on May 18, 2025, the company promptly engaged two renowned and independent geotechnical consulting firms, Beck Engineering from Australia and Open House Management Solutions (hereinafter referred to as "Open House") from South Africa, to conduct an investigation at the Kamoa-Kakula Mine. With the support of Ivanhoe Mines, the two consulting firms worked closely with the Kamoa-Kakula engineering team. The preliminary investigation results indicate that the mine seismicity originated from areas in the eastern section of the Kakula Mine with high ore extraction rates. It is currently believed that the secondary stope, originally planned for Step-2 mining, experienced subsidence-induced yielding deformation, leading to stress redistribution and transmission to the pillars in the area. This, in turn, caused the pillars to yield and deform due to excessive bearing stress. Although backfilling of the mined-out areas could not prevent stress redistribution to the regional pillars, it may have mitigated the effects in some cases. Meanwhile, it cannot be ruled out that adverse geological factors within the area exacerbated the yielding deformation of the pillars. Pillars are unmined ore or rock left in place to support the roof of underground voids; mined-out areas refer to spaces underground where mining has been completed. Backfilling is the operation of filling mined-out areas with a mixture of tailings and cement, which, after consolidation, can achieve the target strength. The geotechnical evaluation has not yet been completed and will be further detailed in the eastern section of the Kakula Mine after the dewatering operations are finished. The preliminary investigation results recommend changes to the short-term mining plan to increase the width of the pillars, thereby providing stronger structural support. The results also suggest adjusting the mining sequence to improve stress distribution and overall stability. Additionally, an enhanced rock mechanics monitoring system will be installed throughout the mine. The management of Kamoa-Kakula, along with Beck Engineering, Open House, and other technical consultants, are making revisions to the short-term, medium-term, and long-term mining plans based on the geotechnical investigation findings. Prior to the mine seismicity, the company was in the process of updating the comprehensive mine life-of-mine development plan, which has now been suspended until Ivanhoe Mines' engineering team and its panel of technical experts complete their review and agree to the relevant changes. After the update work resumes, Ivanhoe Mines will provide updates on the progress of the revised comprehensive development plan. The Phase I and II beneficiation plants are operating at reduced capacities, and production ramp-up will be advanced following the resumption of mining operations in the western section of the Kakula Mine; the Phase III beneficiation plant continues to perform exceptionally well. On June 7, 2025, mining operations in the western section of Kakula were safely and prudently resumed. It is planned to increase the underground mining capacity to 3.6 million mt per year in Q3. Combined with ore from surface stockpiles and supplementary ore from the northern Kamoa Mine, this will be sufficient to support over 80% of the combined designed capacity (9.2 million mt per year) of the Phase I and II beneficiation plants. It is expected that in the second half of the year (H2), the copper grade of raw ore in the Kakula West section will range between 3.0% and 4.0%. Since the suspension of underground operations on May 18, 2025, the Phase I and Phase II beneficiation plants have been operating at approximately 50% of their combined capacity, processing ore from surface stockpiles. The Phase III beneficiation plant adjacent to the Kamoa mine (see Figure 3) has maintained excellent operational performance since the beginning of this year. The plant's current average ore processing capacity is equivalent to an annualized capacity of 6 million mt, which is 30% higher than the designed capacity of 5 million mt per year. As of 2025, the average copper grade of ore processed by the Phase III beneficiation plant has been 2.84%. The mining output from the Kamoa and Kansoko mines has increased over the past two months, exceeding an annualized production of 6.8 million mt. The short-term mining plans for the Kamoa and Kansoko mines have been updated to incorporate recommendations from preliminary geotechnical investigations. The long-term mining plans will be reviewed in conjunction with the overall review of the Kakula mine. 2025 Production Guidance Revision The updated 2025 production guidance for Kamoa-Kakula is based on assumptions and estimates as of June 10, 2025, and involves estimates of known and unknown risks, uncertainties, and other factors that may differ significantly from actual results. The revision of the 2025 production guidance has taken into account the potential impacts of recent seismic events and the resulting disruptions to mining operations at the Kakula mine. Although mining operations have resumed in the Kakula West section, it is currently impossible to accurately predict potential further seismic events, the resulting disruptions, the integrity of underground infrastructure, the ability to ramp up production in underground operations, the ability to complete dewatering work, and the timing of the commissioning of new mining areas in the Far East section. The updated 2025 production guidance is based on the aforementioned factors, and the company's management believes these considerations and assumptions are reasonable given all currently available information. Figure 4 provides detailed information on the revision of the production guidance. All figures are stated on a 100% project equity basis. The reported metal content in concentrate does not account for losses or deductions under smelting agreements. Upon further review, the 2026 copper production target of approximately 600,000 mt has been withdrawn. Ivanhoe Mines will provide further updates on the 2026 production target as more information becomes available. Ivanhoe Mines will provide an update on the 2025 C1 cash cost guidance in its Q2 2025 financial report. The one-step copper smelter at the mine site will commence operations in Q3 Senior management at Kamoa-Kakula has confirmed that the one-step copper smelter at the mine site will begin operations in early September 2025, with the first copper anodes expected to be produced in October. Smelters can operate at a minimum of 50% capacity, which is equivalent to an annualized copper production of approximately 250,000 mt. As of May 31, 2025, there were 33,000 mt of copper in copper concentrates onsite at the mine that had not been sold. It is expected that the first batch of concentrates will be fed into the process approximately four to six weeks after production starts, and it is estimated that there will be a total of approximately 35,000 mt of copper in concentrates in inventory pending sale at that time. In addition, the senior management of Kamoa-Kakula expects that the Inga II hydropower station's Unit 5 turbine (with a designed power of 178 MW) will be commissioned in October 2025, further increasing the hydropower capacity available to the Kamoa-Kakula copper mine through the domestic power grid.

[SMM Analysis:When it rains, it pours: Global copper concentrate supply-demand balance results after KK Mine earthquake ] At the end of May, Chinese smelters started mid-year negotiations with Antofagasta. In the first round of negotiations this year, mining companies have offered smelters a quotation with -$15 , which is far lower than the $0 leaked by the market in late April. According to SMM, many raw material procurement teams from leading smelters in the CSPT group stated that this negotiation is extremely difficult, and it is arduous to strive for a favorable figure.

On the macro front, as China and the US reached a substantive consensus on easing economic and trade tensions in Geneva, the trajectory of the US's trade policies toward major economies has once again fluctuated. Despite the US Secretary of Commerce expressing the intention to finalize agreements with major trading partners before summer, President Trump recently reiterated the possibility of imposing a 50% tariff on the EU, leading to heightened market risk aversion and putting pressure on the US dollar index. The 90-day negotiation window briefly reopened between the US and the EU still faces significant uncertainty. Trump's tax reform bill narrowly passed the House of Representatives, proposing a substantial increase of $4 trillion in the debt ceiling. It is expected that the scale of US debt will expand by an additional $3.3 trillion over the next decade, with the federal debt ratio potentially surging to 125% of GDP, indicating an increasingly aggressive path of fiscal expansion. In terms of monetary policy, although some Fed officials, such as Waller, lean toward initiating interest rate cuts in H2 if tariffs decline, given the frequent changes in trade policies and the potential impact of tariffs on supply chains, the market believes that the Fed is unlikely to take substantive action before July, and the pace of interest rate cuts may be delayed. This week, copper prices fluctuated rangebound as expected, with LME copper trading around $9,550-9,650/mt and SHFE copper trading around 77,700-78,500 yuan/mt. On the fundamental front, Antofagasta conducted negotiations for mid-2025 long-term contracts in Japan last week, with the initial TC offer at -$15/mt. According to market sources, the Japanese side showed low acceptance of this offer, and no specific figures were released during the first round of negotiations in China this week. Mid-week, the incident at the Kamoa-Kakula copper mine in the DRC gradually escalated, with both major shareholders issuing statements announcing the suspension of underground mining operations, with the total impact yet to be assessed. For copper cathode, spot premiums both domestically and internationally declined this week, with no pre-holiday stocking demand evident and social inventory remaining flat overall. The SHFE backwardation structure narrowed for consecutive months, while the LME backwardation structure expanded significantly. Looking ahead to next week, macroeconomic data for May from various countries is set to be released. Affected by tariffs, it is expected that economic data for April-May will show little marginal growth overall, and copper prices are anticipated to remain flat. It is expected that LME copper will fluctuate rangebound between $9,350-9,550/mt next week, while SHFE copper will fluctuate between 77,000-78,000 yuan/mt. On the spot front, as the country gradually enters the off-season for consumption, downstream demand remains weak amid high copper prices. However, the supply of imported copper is also tight, leading to a state of weak balance with both supply and demand decreasing domestically. It is expected that spot premiums will stabilize after a slight drop. Spot prices against the SHFE copper 2506 contract are expected to range from a premium of 80-150 yuan/mt.

Ivanhoe Mines shares tumbled on Monday after the miner withdrew its production and cost guidance for the Kamoa-Kakula copper complex in the Democratic Republic of Congo following a temporary suspension of underground operations. In a press release, the company said its is reviewing its 2025 copper production target of 520,000 to 580,000 tonnes after the Kakula underground mine was rocked by recent seismic activity. The ramp-up schedule for a new smelter has also been withdrawn.

Previously, the US implemented reciprocal tariffs, sparking market concerns that a potential disruption in trade chains could drag down economic growth and push up inflation. Risk assets were broadly sold off, and copper prices were not spared from the downturn. Subsequently, trade conflicts began to ease, and copper prices embarked on a path of recovery. However, it can be observed that SHFE copper faced significant resistance at the gap left by the sharp drop in early April, while support below was also strong, with futures prices fluctuating rangebound around the 78,000 yuan level. Why has SHFE copper been caught in a dilemma recently? Is there a possibility for futures prices to break out of the rangebound situation in the future? Uncertainty remains over the tariff grace period Recently, negotiations between the US and various countries have been underway. In particular, after the 90-day reciprocal tariffs between China and the US were reduced to 10%, the market briefly traded on the logic of easing tariff tensions. However, the progress of some negotiations has been slow. Recently, Trump's attitude shifted, and he again proposed imposing tariffs on the EU. The market is also concerned about the possibility of renewed trade frictions after the tariff grace period. The positive impact of the short-term tariff easing has largely been priced in, making it difficult to provide further support for market sentiment. In addition, to divert attention from domestic contradictions such as the massive scale of debt, it is difficult for the US to restore tariffs on other countries to pre-2024 levels, and concerns about the economic growth outlook cannot be easily allayed. Judging from the recently released US economic data, the impact of tariff disruptions has so far been limited. US inflation in April was lower than expected, and the monthly rate of retail sales rose by 0.1%, exceeding expectations. The Markit manufacturing and services PMIs for May also exceeded expectations. However, the issue of the US's high debt burden still persists, with a significant amount of US debt maturing in June. Recently, Trump's tax cut bill narrowly passed the House of Representatives, and the market continues to worry about the US's mounting debt. The impact of tariff increases on the economy also remains to be tracked. Mining-side processing fees remain at extremely low levels, and the supply side appears somewhat fragile Since last year, tight ore supply has been a major factor plaguing the copper market. However, except for the news in March this year that Tongling Nonferrous Metals Group would carry out production cuts and maintenance, the production of domestic smelters has largely not been constrained by tight ore supply and extremely low processing fees. Therefore, against the backdrop of steady to increasing production in the smelting sector, the issue of tight ore supply alone is unlikely to provide a substantial boost to copper prices. However, it cannot be overlooked that the current spot processing fees for domestic copper concentrates have fallen below -$40/dmt, and the annual and quarterly processing fees negotiated between domestic smelters and overseas miners are increasingly lower. Recently, the market has focused its attention on the mid-year negotiations between global copper mining giant Antofagasta and Chinese and Japanese smelters. Previously, sources revealed that due to tight copper concentrate supply, smelters may request a "zero-dollar" processing fee, or even a negative value, for the second half of 2025. If the rumors are true, the output of by-products such as sulphuric acid may not be sufficient to offset the losses, undoubtedly exacerbating the production pressure on domestic small and medium-sized smelters. Meanwhile, there have been more disruptions in overseas mining operations. Last Tuesday, Ivanhoe Mines announced that mining operations at its Kakula underground mine within the Kamoa-Kakula copper mining area in the Democratic Republic of Congo (DRC) had been temporarily suspended, primarily due to the impact of an earthquake. Its Phase I and II beneficiation plants continue to operate at low capacity using surface ore stockpiles, while operations at the Kamoa mine and Phase III beneficiation plant remain unaffected. Kamoa-Kakula is a world-class, large-scale, ultra-high-grade copper mine. The Phase I mine, with a capacity of 6 million mt/year, was constructed at Kakula, while Phase II utilizes existing facilities at the Kansoko mine to increase capacity to 12 million mt/year. In the evening of May 23, Zijin Mining, another major investor in the mine, also issued an announcement, stating that the earthquake is expected to adversely affect the achievement of the Kamoa-Kakula copper mine's annual planned production, with the specific extent of the impact requiring further assessment based on the investigation results. Overall, due to the faster expansion of global smelters, the copper ore supply tightness is relatively severe and is unlikely to ease significantly in the short term. Against the backdrop of strong bargaining power of miners, the copper concentrate TCs negotiated by smelters are becoming increasingly lower, with the possibility of approaching zero. In the early stage, smelters adjusted their operations through measures such as long-term contracts, supplementing with other raw materials, and offsetting profits with by-products such as sulphuric acid, maintaining overall stable production. Recently, during the concentrated maintenance period of the year, there are still few maintenance plans among domestic smelters, and there has been no significant production cut due to ore shortages. Going forward, attention should still be paid to the long-term contract levels of copper concentrate TCs negotiated between overseas miners and domestic smelters. Before the ore supply tightness can be transmitted to the smelting end, it will still be difficult to provide more upward momentum for copper prices. If smelters indeed undertake substantial production cuts, copper prices may experience a sharp increase. Social inventory of domestic copper cathode accumulates slightly, with expectations of weakening demand Recently, the performance of global copper visible inventories has been divergent. COMEX copper inventories have continued to rebound, rising from around 92,000 mt in early March to approximately 175,600 mt currently, reflecting the process of global copper flowing into the US amid expectations of a possible tariff hike on imported copper by the US. Correspondingly, LME copper inventories have been continuously pulling back, declining from around 260,000 mt in early March to approximately 164,700 mt currently, with a significant destocking amplitude. The current price spread between COMEX copper and LME copper remains at a relatively high level. Before the implementation of copper-related tariffs by the US, global copper will continue to flow into the US due to the existence of profits. Domestically, the traditional peak season of "Golden March, Silver April" has passed. Coupled with the rebound of copper prices from low levels, the downstream demand in the domestic copper market has weakened compared to the previous period, and the destocking of social inventories of copper cathode in China has halted. However, overall, the extent of inventory buildup has been very limited so far, and the inflow of domestic inventories has also been influenced by the outflow of exchange warrants and the inflow of inventories from bonded areas. From the downstream industry data released this month, the high-growth momentum of power grid investment continues, and the State Grid Corporation of China's annual record-high target is relatively certain. This aspect of demand will continue to support copper prices. According to data from the National Bureau of Statistics, automobile production continued to increase YoY, and industry prosperity persisted. However, in April, the production of refrigerators and air conditioners both pulled back, indicating a potential weakening in demand in this sector. Overall, during the moratorium period, global trade frictions have eased compared to the previous period, but uncertainties in negotiations still persist. Moreover, against the backdrop of deglobalization, market concerns about the economic outlook are difficult to completely dispel, and the suppression at the previous gap still exists. On the supply and demand side, concerns about tight ore supplies have lingered for a long time, and recent disruptions at the ore end have increased again, continuously consolidating the downward support for copper prices. Additionally, the siphon effect of the US has also made it difficult for copper inventories in other regions to accumulate significantly. However, the output of copper cathode remains stable, and there are expectations of a marginal weakening in demand. Therefore, a breakout from the current stalemate in SHFE copper prices may require more definitive changes to occur.