According to market sources, Chilean miner Antofagasta has recently proposed to several major Chinese copper smelters that mid-year copper concentrate contracts be priced using spot-market TC/RC indexes rather than the traditional fixed benchmark TC/RC structure. Since the 1980s, annual benchmark treatment and refining charges (TC/RCs) have been established through negotiations between leading miners and smelters, serving as a reference point for copper concentrate contracts worldwide. However, the benchmark system is facing growing pressure as global copper concentrate supply tightens, smelting capacity continues to expand, and spot TC/RCs fall to unprecedented lows. As of June 12, 2026, the SMM Imported Copper Concentrate Index had declined to a record low of -US$119.84/mt. If more miners move toward index-linked pricing mechanisms, the long-standing benchmark TC/RC pricing system could face a fundamental shift.

As the United States continues to strengthen critical minerals security, domestic manufacturing, and copper supply chain resilience, limited smelting capacity is increasingly emerging as a key challenge. The country currently operates only a handful of primary copper smelters, while low treatment and refining charges (TC/RCs) and rising environmental compliance costs continue to pressure profitability. Alongside efforts to expand domestic mining and manufacturing capacity, maintaining existing smelting operations and securing refined copper supply will remain critical to the long-term success of U.S. copper supply chain strategy. Continued pressure on the smelting sector could limit the country's ability to reduce reliance on imported refined copper in the near term.

Mitsubishi Materials Corporation said on Wednesday that it had decided to cease the processing of copper concentrates at the Onahama smelter and refinery, as well as the operation of related smelting facilities, by the end of March 2027.In a statement, the company said the outlook for the related business had become increasingly uncertain due to intensifying competition from overseas smelters and a sharp decline in treatment and refining charges (TC/RCs) for copper concentrates.The company said in a statement that it expected to record an impairment loss of 21 billion yen in Q4 of the current fiscal year ending this month, mainly related to the smelter's fixed assets.

SMM Morning Meeting Summary: Overnight, LME copper opened at $12,257/mt. After bottoming at $12,208/mt in early trading, its center fluctuated upward and reached a high of $12,383/mt, then hovered at highs and finally closed at $12,283/mt, up 1.58. Trading volume reached 23,000 lots, open interest stood at 296,000 lots, an increase of 3,418 lots from the previous trading day, mainly reflecting bulls adding positions overall. Overnight, the most-traded SHFE copper 2605 contract opened at 95,950 yuan/mt, bottomed at 95,530 yuan/mt in early trading, and then its center moved higher to a high of 96,580 yuan/mt. Copper prices then saw their center move lower and finally closed at 96,250 yuan/mt, up 1.11. Trading volume reached 51,000 lots, open interest stood at 190,000 lots, down 2,036 lots from the previous trading day, mainly reflecting bears reducing positions overall.

With tight concentrate supply and low treatment & refining charges, electronic scrap is evolving from a supplementary feedstock to a strategic source of recycled copper. Although currently a small share of recycled copper, improved processing could significantly boost its contribution. Advanced shredding and recovery technologies are expected to make e-scrap a key diversified feedstock for smelters.

SMM Morning Meeting Minutes: On Friday evening, LME copper opened at $11,008.5/mt, initially fluctuating rangebound and touching a low of $10,986.5/mt, after which copper prices gradually shifted their center upward, reaching a high of $11,210.5/mt, then fluctuated considerably and finally closed at $11,175.5/mt, a gain of 2.25%, with trading volume reaching 22,600 lots and open interest reaching 334,000 lots. Overnight, the most-traded SHFE copper contract 2601 opened at 87,630 yuan/mt, initially touching a low of 87,520 yuan/mt, then fluctuated upward to a high of 89,000 yuan/mt, subsequently fluctuated considerably and finally closed at 88,740 yuan/mt, a gain of 1.75%, with trading volume reaching 85,000 lots and open interest reaching 225,000 lots.

SMM Morning Meeting Minutes: LME copper opened at $10,560.5/mt overnight, initially touched a low of $10,490/mt, then copper prices rose all the way to a high of $10,659.5/mt near the end of the session, and finally closed at $10,620/mt, up 0.42%, with trading volume reaching 20,000 lots and open interest reaching 320,000 lots. The most-traded SHFE copper 2512 contract opened at 84,530 yuan/mt overnight, initially touched a low of 84,510 yuan/mt, then fluctuated upward to a high of 85,430 yuan/mt, and finally closed at 85,140 yuan/mt, up 0.09%, with trading volume reaching 55,000 lots and open interest reaching 216,000 lots.

Japan, Spain and South Korea jointly expressed concern that treatment & refining charges (TC/RCs) for copper concentrates are collapsing, making smelting operations globally less viable.

[SMM Analysis:Grasberg Production Incident Heightens Expectations of Disruptions on Copper Supply Side] According to a report by Freeport-McMoRan, since the slurry accident at the Grasberg copper mine in Indonesia on September 8, two people have died and five are missing. The incident directly led to the suspension of operations at the world’s second-largest copper mine. Freeport-McMoRan estimates that its 2026 production could be 35% lower than previously projected. Based on SMM's assessment, Grasberg’s copper production is expected to be 488,000 metric tons in 2025 (previously estimated at 750,000 metric tons) and 500,000 metric tons in 2026 (previously estimated at 730,000 metric tons). This incident not only affects copper concentrate supply but also impacts copper smelting demand, represented by facilities such as Indonesia’s Gresik and Manyar, resulting in a reduction in both supply and demand. SMM predicts the supply-demand balance for 2025 will be -268,000 metric tons and -308,000 metric tons for 2026.