Refined Copper Flows Split Between US Stock-Build and China Demand Recovery

US Copper

Refined copper flows are being pulled in two directions as US tariff risk draws cathode into Comex warehouses while China returns to the seaborne market after a sharp fall in domestic inventories. The result is not a simple global shortage, but a more complex location-driven contest for metal.

Refined copper flows were distorted in the first quarter by financial investor activity, US policy uncertainty and weak Chinese import economics. That balance is now shifting as China’s import arbitrage reopens, while US buyers and traders continue to position ahead of possible refined copper tariffs.

Refined copper flows are therefore becoming more strategic. The same unit of cathode can carry different value depending on whether it sits in the US, China, bonded warehouses or LME storage.

This market structure matters because copper is no longer priced only against broad industrial demand. Tariff risk, warehouse location, arbitrage spreads, strategic stock-building and smelter economics are now shaping physical trade.

US Tariff Risk Keeps Pulling Copper Into Comex

US copper inventories continue to build as tariff uncertainty supports a location premium. Comex warehouse stocks rose to 615,852 short tons on 4 May, up 5% from 586,563t on 14 April.

This build does not necessarily show stronger underlying US consumption. It shows that market participants are willing to pay to position metal inside the US before potential import tariff announcements this summer.

US refined copper and unwrought copper alloy imports under HS 7403 reached 382,952t in January-February 2026. That was up 184% from 134,754t a year earlier.

The longer trend is even clearer. Imports over March 2025-February 2026 more than doubled to 1.9mn t from 923,701t in the previous 12-month period.

Arbitrage has reinforced the flow. The LME cash official to Comex cash copper arbitrage widened to minus $385.14/t on 1 May from minus $261.24/t on 30 April and minus $126.50/t on 29 April.

That widening spread signals a stronger US location premium. It gives traders an incentive to direct copper units into Comex warehouses rather than leave them available to other regional buyers.

This has important supply-chain implications. A high level of visible copper stock does not automatically mean metal is freely available to every market. If inventories are concentrated in one jurisdiction for policy reasons, other regions can tighten even while global stock numbers look comfortable.

The US stock-build is therefore a policy-driven trade flow. It reflects uncertainty over future tariff treatment, not a normal demand cycle.

For manufacturers, this creates procurement risk. Fabricators outside the US may face tighter access to marginal units if traders continue sending cathode into the American system.

For traders, location is becoming a profit centre. The value is not only in the copper price, but in where the copper is held and what policy regime applies to it.

China Import Window Reopens as Domestic Stocks Fall

China is now creating the counter pull. Shanghai Futures Exchange copper warehouse stocks fell to 201,373t on 24 April from 433,458t on 13 March.

Bonded copper stocks also slipped to 19,159t on 24 April from 22,547t on 20 March. That drawdown reopened space for imported cathode after a weak first quarter for overseas material.

China’s import arbitrage improved sharply at the end of April. The grade A copper cathode import margin rose to 427 yuan/t on 30 April from 94 yuan/t on 28 April and minus 73 yuan/t on 23 April.

If the window remains open, China’s second-quarter refined copper imports could recover from first-quarter levels. Buyers have a clearer reason to replenish domestic supply after the recent inventory draw.

However, the recovery may be uneven. High outright copper prices still limit fabricator appetite, and part of the stock draw reflects seasonal restocking after the first-quarter lull.

The wider inventory picture still does not support a broad scarcity narrative. LME copper stocks remained sizable at 398,675t, while on-warrant inventories have risen sharply since early January.

This means the market is not short everywhere. It is tight in specific locations, under specific pricing structures, and for specific buyers.

That is the core point. Refined copper flows are increasingly being shaped by regional availability rather than total visible inventory.

Smelter economics add another risk to the China outlook. Copper concentrate treatment and refining charges remain deeply negative, showing that mine supply is tight while smelting capacity remains excessive.

Chinese smelters have continued running at high rates despite negative treatment charges. High sulphuric acid by-product values have helped support operating economics.

That balance may become more fragile after China’s suspension of sulphuric acid exports from May. If more acid remains in the domestic market, smelters may face weaker by-product revenue or rising storage pressure.

If domestic acid demand cannot absorb the extra supply, some smelters may bring forward maintenance. That would tighten refined copper output later in the quarter and strengthen the case for more imports.

The refined copper market is therefore in a split-flow pattern. US policy risk is pulling copper west, while China’s inventory draw and import window are pulling metal back east.

For other regions, that creates a squeeze. Europe and other buyers may find marginal cathode harder to source even while global inventories appear adequate.

The Metalnomist Commentary

Copper is moving from a global inventory story to a location and policy story. The real risk is not that the world lacks refined copper today, but that tariff positioning, Chinese restocking and smelter economics keep redirecting the same units away from other buyers.

Nyrstar Australian Smelters Face Uncertain Future Without New Funding

Nyrstar

Nyrstar Australian smelters face an uncertain future as the company reviews possible closures or output curtailments at its Port Pirie lead smelter and Hobart zinc smelter. The review comes after interim government rescue funding expired without a second phase being agreed.

Nyrstar Australian smelters received A$135mn in interim support in August last year. The funding was designed to keep the 160,000 t/yr Port Pirie lead smelter in South Australia and the 280,000 t/yr Hobart zinc smelter in Tasmania operating while longer-term solutions were assessed.

Nyrstar Australian smelters are strategically important because they preserve domestic processing capability for base metals and potential critical minerals. But the facilities remain economically challenged by weak commodity pricing, high energy costs and the need for capital investment.

The company, owned by Trafigura, said it is now exploring all options for the two assets. No final decision has been made on closures or production cuts.

Port Pirie and Hobart Test Australia’s Industrial Policy

The Port Pirie and Hobart smelters sit at the centre of Australia’s debate over whether strategic processing capacity should be preserved through public support. Both assets are partway through two-year feasibility studies to diversify output into critical minerals such as bismuth and tellurium.

This diversification is important because traditional lead and zinc smelting margins have been under pressure. Adding critical minerals could improve the strategic value of the facilities and create new revenue streams.

Port Pirie has already started moving in that direction. The first shipment of antimony from a pilot plant was exported in February under the first-phase funding agreement.

Nyrstar said the Port Pirie pilot plant could produce 2,000 t/yr of antimony by the end of this year. That would be meaningful because antimony is increasingly viewed as a strategic metal for defence, flame retardants, batteries and industrial alloys.

Hobart has already faced production cuts during weaker zinc market conditions. That history shows how exposed the site remains to zinc prices, energy costs and operating margins.

Without a second funding phase, Nyrstar may cut capital expenditure and operating costs as part of the review. That could delay diversification plans and weaken Australia’s ability to preserve downstream metal processing capacity.

Critical Minerals Could Decide Smelter Value

The future of the two smelters may depend on whether they can become more than conventional lead and zinc assets. Processing critical minerals could give them a stronger role in Australia’s industrial strategy.

Australia’s Future Made in Australia policy aims to retain industrial capability and use renewable energy to support low-carbon exports, including metals. Smelters such as Port Pirie and Hobart fit that policy direction if they can become competitive and strategically relevant.

The challenge is cost. Existing smelters need reliable power, capital upgrades and market support to compete against lower-cost global processors.

Recent government support for aluminium and copper processors shows that Canberra is willing to intervene when strategic industrial assets face closure. But each case still needs a credible long-term pathway.

For Nyrstar, that pathway may involve antimony, bismuth, tellurium and other by-product metals. These materials can improve the value of complex smelting operations if they are recovered efficiently and sold into secure supply chains.

For Australia, the decision is broader than one company. Losing smelting capacity would weaken domestic processing depth at a time when governments are trying to reduce dependence on concentrated foreign refining systems.

The Metalnomist Commentary

Nyrstar’s Australian smelter review shows that critical minerals policy must extend beyond mining into processing assets that already exist. The key question is whether Australia can turn legacy smelters into strategic by-product platforms before high energy costs force permanent closures.

Glencore Copper Production Rises as DRC Cobalt Quota Reshapes Output Priorities

Glencore

Glencore copper production rose sharply in the first quarter as higher grades at its African copper mines and stronger throughput at Antamina lifted output. The Switzerland-based trading and mining group produced 199,600t of copper, up 19% from a year earlier.

Glencore copper production growth contrasts with a steep fall in cobalt output. Own-sourced cobalt production dropped by 39% to 5,800t, mainly because the Democratic Republic of Congo’s export quota system has changed how producers manage shipments and mine planning.

Glencore copper production is now becoming more important inside its DRC asset base because cobalt export limits have made copper the clearer operating priority. This shift shows how state policy can directly reshape output behaviour in multi-metal mining systems.

The company maintained full-year production guidance for copper, nickel and zinc, despite weaker output in several other metals. Copper guidance remains at 810,000-870,000t for the year.

DRC Quota System Pushes Cobalt Lower

The sharp fall in cobalt output reflects the DRC’s quota system, introduced after the country moved away from its earlier export ban framework. The system capped shipments and set annual limits for 2026-27, with an additional strategic pool.

For Glencore, the practical effect is clear. Its DRC assets are now prioritising copper production because copper can move through the market with fewer quota-related constraints.

This matters for battery and superalloy supply chains. The DRC remains the world’s dominant source of mined cobalt, so export policy can quickly affect availability, pricing and producer behaviour.

Cobalt is not produced in isolation at many Congolese operations. It is often linked to copper mining, which means policy limits on cobalt can influence mine sequencing, processing priorities and inventory decisions.

The first-quarter numbers therefore point to a more managed cobalt market. Supply is not only a function of ore grades and plant capacity. It is increasingly controlled by export approvals, quotas and state strategy.

Copper benefited from stronger grades at African operations and higher throughput at Antamina in Peru. That performance reinforces copper’s stronger strategic position at a time when demand from grids, electrification, industrial policy and data centres continues to attract market attention.

Nickel, Zinc and Ferro-Chrome Show Operational Pressure

Glencore’s nickel output fell by 9% to 17,200t. The decline was caused by a furnace disruption at the Sudbury complex in Canada, which affected matte shipment timing to Norway.

Nickel guidance remained unchanged at 70,000-80,000t. This suggests Glencore sees the first-quarter weakness as manageable rather than a full-year supply reset.

Zinc output fell by 17% to 176,900t. The decline was mainly linked to the closure of the Lady Loretta mine in Australia and lower output from Kazzinc in Kazakhstan.

Zinc guidance also remained unchanged at 700,000-740,000t. However, the first-quarter result shows how mine closures and regional production issues can still weigh on quarterly availability.

Ferro-chrome output collapsed by 95% to 13,000t because of continued care and maintenance at Glencore’s chrome smelting operations and the phased restart of the Lion Smelter in South Africa.

South African ferro-chrome remains under pressure from high energy prices and competition from lower-cost Chinese material. This has forced output cuts at major producers and weakened South Africa’s position in global ferro-alloy supply.

Glencore’s vanadium pentoxide production rose by 5% to 2,300t, offering a small positive signal in another strategic alloy material.

Overall, the quarter shows a company benefiting from copper strength while managing policy and cost pressures across cobalt, nickel, zinc and ferro-chrome. The most important signal is that copper and cobalt are now being shaped by very different forces: copper by grade and throughput, cobalt by DRC export control.

The Metalnomist Commentary

Glencore’s results show how government policy can be as powerful as geology in multi-metal supply chains. The DRC cobalt quota is not only reducing cobalt output; it is pushing producers to prioritise copper in one of the world’s most strategic mining regions.

Vale Thompson Nickel Belt Restructuring Secures New Capital for Canadian Nickel Supply

Vale Base Metals

Vale Thompson Nickel Belt restructuring marks a strategic move to keep one of Canada’s established nickel districts operating while reducing Vale’s direct exposure. Vale Base Metals has agreed to form a consortium for its Thompson nickel operations following a strategic review.

Vale Thompson Nickel Belt assets will receive up to $200mn in partner commitments to support long-term sustainability. Vale will retain an 18.9% interest in the consortium, while also securing a nickel concentrate offtake agreement.

Vale Thompson Nickel Belt restructuring matters because western buyers are paying closer attention to non-Indonesian nickel supply, origin transparency and long-term feedstock security. Thompson offers a Canadian source of nickel concentrate at a time when the market remains heavily influenced by Indonesian production growth.

The consortium is expected to close by the end of 2026, subject to regulatory approvals. Vale did not name the consortium partners.

Thompson Deal Preserves Exposure While Reducing Operating Risk

The new structure suggests Vale wants to keep Thompson in production without carrying the full capital and operating burden alone. The company is reducing direct exposure but preserving strategic access through its retained stake and concentrate offtake.

This matters because Thompson has faced operational pressure. Production at the mine fell by 66.7% on the year to 12,000t in the first quarter after a pipeline blockage was aggravated by poor weather.

The consortium model could help stabilise the asset if new partners bring capital, operational focus and a longer-term investment plan. For a mature nickel operation, sustaining capital and reliability upgrades can be as important as headline resource size.

The concentrate offtake agreement is equally important. It gives Vale continued access to material while allowing outside capital to support the mine’s future.

For western nickel supply chains, Thompson has strategic relevance beyond its near-term production volume. Non-Indonesian nickel units are becoming more valuable for buyers seeking diversified supply, lower geopolitical concentration and clearer provenance.

This is especially relevant for stainless steel, alloy, battery and defence-linked customers that want alternatives to Indonesia-dominated supply growth. Canadian nickel concentrate can help support that diversification if the operation remains stable.

Strong Copper and Nickel Prices Lift Vale Base Metals Earnings

The Thompson restructuring came as Vale Base Metals reported a sharp improvement in first-quarter earnings. Net revenue rose by 37% on the year to $2.38bn, while adjusted Ebitda more than doubled to $1.2bn from $554mn.

Nickel earnings recovered strongly. Adjusted nickel Ebitda climbed to $277mn from $41mn a year earlier, supported by higher realised prices, stronger sales, lower unit costs and better by-product credits.

Vale’s average realised nickel price rose by 6% to $17,015/t. Nickel sales volumes increased by 15% to 45,000t.

Cost improvements at Sudbury, Voisey’s Bay and Long Harbour also supported the nickel result. This shows that Vale’s Canadian nickel platform still has earnings leverage when operating performance improves and prices firm.

Copper delivered an even stronger contribution. Copper-adjusted Ebitda rose by 74% year on year to $949mn in the first quarter.

Vale’s realised copper price jumped by 48% to $13,143/t, while copper sales volumes rose by 18% to 72,000t. Stronger gold by-product revenues and improved performance at Sossego also supported the result.

The company increased copper sustaining capital expenditure by 54% to $83mn, with spending on the Bacaba copper project a key driver. Total copper capex, including growth spending, rose by 56% to $89mn.

At group level, Vale’s adjusted Ebitda rose by 23% to $3.83bn. The result shows how stronger copper and nickel prices can quickly improve earnings when production, sales and by-product credits align.

For Vale, the strategic message is clear. Copper provides growth and margin strength, while nickel requires selective restructuring, cost discipline and stronger asset-level sustainability.

The Metalnomist Commentary

Vale’s Thompson move shows that western nickel supply will increasingly depend on partnership models, not only mine ownership. The asset’s value lies in preserving Canadian concentrate supply at a time when buyers want alternatives to Indonesian nickel dominance.

Indonesia Nickel Pricing Sets Floor and Ceiling as HPAL Costs Rise

Huafei Nickel Cobalt

Indonesia nickel pricing is increasingly defining the global nickel market as ore quotas, benchmark pricing rules and sulphuric acid availability reshape supply economics. UK broker Sucden Financial said Indonesia is now setting both the floor and ceiling for nickel prices.

Indonesia nickel pricing has moved the market away from a simple oversupply story. The key question is no longer only how much nickel Indonesia can produce, but how tightly Jakarta chooses to manage supply.

Indonesia nickel pricing is also becoming more important because HPAL producers face rising costs for ore, sulphur and sulphuric acid. These inputs directly affect mixed hydroxide precipitate production, which feeds battery-grade nickel supply chains.

The London Metal Exchange nickel price settled at $19,500/t on Wednesday, while Sucden said Indonesia’s current policy stance is creating a firmer floor around $18,000/t. But upside may also be capped if higher prices encourage new quota approvals.

Indonesia Turns Ore Policy Into Market Control

Indonesia remains the central force in nickel because it controls the largest source of new supply. In recent years, Indonesian output growth, large exchange stocks and Chinese-linked processing capacity defined the market.

That structure is now changing. Sucden said Indonesia appears focused on supporting prices and discouraging weaker producers, rather than allowing unrestricted supply growth.

The country has reduced 2026 ore quotas by around 30% year on year. It has also revised its domestic benchmark ore pricing system, strengthening the link between ore valuation, contained metals and producer costs.

This policy approach gives Indonesia unusual pricing power. If supply is restricted, the market finds a firmer floor. If prices rise too far, Indonesia can relax quotas and allow more material through the system.

That means nickel’s upside is managed. Sucden warned that the market should become more cautious near $20,000/t, where additional supply approvals and producer hedging could begin to limit further gains.

This is why Indonesia now acts as both support and restraint. It can tighten ore availability to stabilise prices, but it can also prevent a strong rally from damaging downstream competitiveness.

The result is a more policy-driven nickel market. Traditional inventory and demand indicators still matter, but Jakarta’s quota and ore pricing decisions are now central to global price formation.

HPAL Costs Expose Battery Nickel Supply Risk

HPAL production is becoming the second major driver of nickel pricing. Unlike nickel pig iron and ferro-nickel, HPAL is highly dependent on sulphur and sulphuric acid.

This makes battery-grade nickel supply more vulnerable to chemical input availability. HPAL plants need stable acid supply to process limonite ore into MHP, and Indonesia’s inventory buffers are relatively tight.

Huayou’s decision to place half of its Huafei Nickel Cobalt MHP capacity into temporary care and maintenance from 1 May shows how quickly reagent costs can affect production. The company cited elevated sulphur costs and prolonged high operating rates.

The HPAL sector now faces a double squeeze. Ore prices are rising because of Indonesia’s revised pricing framework, while sulphur and sulphuric acid costs are increasing because of tighter chemical supply.

This changes the nickel cost curve. Producers with secure ore, sulphur access and integrated infrastructure can operate more defensively. Those relying on external feedstock or exposed to high reagent prices face greater margin pressure.

The shift also matters for battery supply chains. MHP is a key intermediate for nickel sulphate and other battery chemicals. If HPAL margins weaken, battery-grade nickel output can become less responsive than headline capacity numbers suggest.

Sucden said tighter nearby spreads and higher trading volumes may indicate increased hedging and another shift in market balance. That suggests producers and traders are adjusting to a market where costs and policy now matter more than simple surplus.

Nickel is still not structurally tight like copper. But it is no longer a market where oversupply alone explains price direction. Indonesia’s supply discipline and HPAL cost inflation are giving nickel a stronger base, even if the rally remains capped.

The Metalnomist Commentary

Indonesia has turned nickel into a managed market where policy controls supply and chemistry controls cost. The winners will be producers with secure ore, acid access and enough balance-sheet strength to survive Jakarta’s tighter discipline.

Copper Aluminium Pricing Divergence Deepens as Middle East Shock Turns Metal-Specific

Sucden Financial

Copper aluminium pricing divergence is becoming clearer as base metal markets absorb the first shock of the Middle East conflict. Copper is shifting back toward physical flows, inventories and policy risk, while aluminium remains supported by direct disruption to Middle East supply chains.

Copper aluminium pricing divergence reflects a broader change in market behaviour. Traders are moving away from headline-led volatility and focusing more on spreads, premiums, inventories and real supply constraints.

Copper aluminium pricing divergence also shows that the base metals complex is no longer trading as one geopolitical basket. Each metal is now being priced according to its own exposure to the war, its physical balance and its ability to replace disrupted supply.

UK broker Sucden Financial said the conflict initially drove broad volatility across commodities. But that phase is fading, leaving copper and aluminium on different pricing paths.

Copper Moves From Macro Risk to Physical and Policy Pricing

Copper began the year as a macro-driven metal. Prices moved with broader risk sentiment, oil, gold and cross-asset positioning.

That relationship is now weakening. Copper is increasingly being priced through its own market signals, including Shanghai inventory drawdowns, US flow incentives, mined supply quality and sulphuric acid-related supply-chain disruption.

This shift matters because copper is no longer responding only to global growth fears or geopolitical headlines. It is being priced through physical availability and policy exposure.

The Comex premium has periodically reopened the arbitrage for copper units to move into the US. This has made the interaction between LME, Comex, inventories and US policy more important to price discovery.

Sucden said the next phase of copper pricing could be shaped by material-security concerns. These include tariff threats, incentives to hold more metal in the US and the strategic value of copper in energy infrastructure.

This is a macro-to-micro rotation. Copper is moving away from broad geopolitical trading and toward a market driven by premiums, spreads, stock locations and supply-chain constraints.

Sulphuric acid remains a key hidden risk. Copper supply from leaching operations, particularly in regions such as the Democratic Republic of Congo and Chile, can be affected if acid availability tightens or costs rise.

The market still remains exposed to recession fears. A deeper economic slowdown caused by the conflict could weigh on copper demand and financial positioning.

However, copper’s resilience suggests that traders are giving greater weight to structural tightness. Supply challenges, low-quality mined material and long-term demand from grids, electrification and industrial policy continue to support the metal.

Sucden argued that copper’s long-term direction remains higher and that price dips should be bought. The structural case has not changed, while eventual dollar weakness after a conflict resolution could provide further support.

Aluminium Holds a Firmer Physical Floor After Supply Shock

Aluminium has already repriced much of the Middle East disruption. The metal briefly moved toward the upper end of its recent range as the conflict escalated, but repeated failures above $3,650/t suggest the market needs further supply deterioration to justify another major move higher.

This does not mean aluminium is weak. It means the initial panic premium has already been absorbed.

Aluminium’s support is more physical than copper’s. The disruption affects smelting, feedstock flows and export availability from the Middle East, making the supply shock more direct than headline numbers may suggest.

Sucden said aluminium remains the base metal with the clearest exposure to the Middle East war. Ex-China supply is tighter, London Metal Exchange inventories are falling and nearby spreads have moved into backwardation.

Chinese inventories have risen, but that does not fully offset the tightness outside China. Regional availability matters more when logistics, origin and delivery routes are disrupted.

Aluminium smelters also cannot restart quickly. Once production is curtailed, bringing capacity back requires time, stable power and commercial confidence.

Elevated energy prices add another layer of cost support. Even if the war de-escalates, smelters and downstream producers may still face a higher operating cost base.

Sucden said de-escalation could initially push aluminium prices toward $3,400/t. But any decline may prove short-lived if physical tightness remains.

This gives aluminium limited immediate upside but also limited downside. The market has already priced much of the shock, yet replacement supply is not easy to find.

The broader implication is that aluminium is trading a tighter physical balance, not only a war premium. That makes its price floor firmer than a market driven purely by sentiment.

For industrial buyers, the copper-aluminium split is important. Copper procurement risk is increasingly tied to policy, US flows and strategic inventory. Aluminium risk is tied more directly to missing tonnes, energy costs and disrupted regional supply.

The Metalnomist Commentary

The Middle East conflict is exposing the real structure of each base metal market. Copper is becoming a policy-and-premium metal, while aluminium is being supported by a more immediate physical supply shock.

Lithium-Ion Battery Copper Foil Shipments Surge as Ultra-Thin Products Gain Share

Copper Foil

Lithium-ion battery copper foil shipments rose sharply in 2025 as global battery production expanded and manufacturers shifted toward thinner materials to reduce copper costs. Global shipments reached 1.302mn t, up 41.7% from 2024, according to Chinese research institute EV Tank.

Lithium-ion battery copper foil demand remains closely tied to electric vehicle and energy storage growth. Copper foil is a key current collector in lithium-ion batteries, making it essential to cell performance, energy density and manufacturing cost.

Lithium-ion battery copper foil shipments were dominated by China, which accounted for 82.9% of global deliveries in 2025. EV Tank expects global shipments to reach 2.615mn t by 2030, implying continued expansion as battery output scales.

The product mix changed quickly during the year. The share of 8μm foil declined, while 6μm remained the mainstream product and accounted for more than 70% of total shipments.

Ultra-Thin Foil Gains Momentum on Copper Cost Pressure

Ultra-thin copper foil gained share as battery producers looked for ways to reduce copper input costs. Persistently high global copper prices pushed cell manufacturers to use thinner foil while maintaining battery performance.

The combined share of 5μm and 4.5μm ultra-thin foil rose to 24% in 2025. This is a major shift for a material category that requires tighter production control, better surface quality and stronger consistency.

Thinner copper foil can help reduce battery weight and improve energy density. It also lowers the amount of copper used per cell, which becomes increasingly important when copper prices remain elevated.

EV Tank expects 5μm and thinner foil to become a key material for high-end batteries. This reflects the industry’s move toward lighter, higher-energy-density cell designs.

However, thinner foil also raises manufacturing difficulty. Producers must control pinholes, tensile strength, elongation, surface roughness and coating compatibility more precisely.

That technical barrier could separate higher-end suppliers from lower-cost producers. As battery customers shift toward thinner grades, qualification and process reliability will become more important than simple capacity.

China Leads Supply as Competition Intensifies

China’s 82.9% share of global shipments shows its dominant role in battery copper foil supply. The country has built large-scale capacity around its lithium-ion battery ecosystem, supported by domestic EV, energy storage and cell manufacturing growth.

Competition intensified in 2025 as the market recovered and producers brought earlier-built capacity on line. This created a more fluid ranking among suppliers.

Longdian Wason ranked first with a 12.2% market share. Huachuang New Material followed after capacity ramp-ups lifted output and sales.

Defu Technology and Jiayuan Technology ranked third and fourth, respectively. Seven companies in the top 10 changed positions during the year, showing how quickly capacity, customer access and product mix are reshaping the sector.

Battery makers also increased procurement from second-tier suppliers to improve supply stability. This suggests buyers are trying to diversify supplier bases rather than rely only on leading producers.

For copper markets, the trend is strategically important. Battery copper foil growth creates a direct link between copper demand and battery technology. But the move toward ultra-thin foil also means battery growth will not translate into copper demand on a simple one-to-one basis.

The sector is therefore entering a more technical phase. Volume growth remains strong, but material intensity, foil thickness, supplier qualification and copper price pressure will all shape future demand.

The Metalnomist Commentary

The copper foil market shows how battery growth can lift copper demand while also forcing material thrift. High copper prices are pushing battery makers toward thinner foil, making technology and process control as important as raw capacity.

ARM Nkomati Nickel Mine Restart Moves Closer With Boliden Concentrate Deal

African Rainbow Minerals

ARM Nkomati nickel mine restart prospects have strengthened after African Rainbow Minerals signed a multi-year nickel concentrate sales agreement with Swedish mining and smelting group Boliden. The agreement could support the return of one of South Africa’s important multi-metal nickel assets.

The ARM Nkomati nickel mine has been on care and maintenance since 2020. ARM and Norilsk Nickel placed the operation into suspension after profitability weakened because of lower output.

The ARM Nkomati nickel mine produced nickel, copper, cobalt, chrome and platinum group metals. Its potential restart would therefore add more than nickel units to the market, supporting several metals linked to batteries, stainless steel, alloys and industrial supply chains.

The deal with Boliden remains conditional. It depends on approval to recommence open-pit mining of nickel-bearing ore at Nkomati, responsible sourcing due diligence by Boliden and other regulatory clearances.

Boliden Agreement Gives Nkomati a Processing Route

The sales agreement gives ARM a potential outlet for Nkomati nickel concentrate if mining restarts. Boliden expects the concentrate to be shipped to its Harjavalta smelter in Finland.

Harjavalta produces nickel matte, making it a logical destination for nickel-bearing concentrate. The route would connect South African mine supply with European smelting capacity.

This matters because nickel concentrate needs secure processing access before a restart can become commercially meaningful. A mine can have geological potential, but it still needs offtake, logistics, smelting capacity and customer qualification.

Boliden’s responsible sourcing due diligence is also important. European smelters and customers increasingly require stronger documentation around mine origin, ESG standards and supply-chain integrity.

The agreement therefore does more than provide a buyer. It gives the Nkomati restart a possible downstream pathway into a European refining and smelting system.

For ARM, the deal could improve the commercial case for reopening the mine. For Boliden, it could provide another concentrate source for its nickel operations at a time when secure non-Indonesian nickel supply remains strategically relevant.

South African Nickel Supply Could Regain Strategic Relevance

Nkomati’s ownership structure has changed since the mine entered care and maintenance. Nornickel’s South African subsidiary agreed in November 2023 to transfer its 50% stake to ARM, and the transaction was finalised in July 2025.

Full ARM control gives the South African company more direct strategic flexibility. It can evaluate restart options without the same joint-venture complexity that previously shaped the asset.

The potential restart comes at a time when nickel markets remain divided. Indonesia dominates new supply growth, but European and western buyers are increasingly interested in diversified, traceable and geopolitically balanced feedstock.

Nkomati’s multi-metal profile adds to its relevance. Nickel remains important for stainless steel, batteries and superalloys. Cobalt supports batteries and high-performance alloys. Platinum group metals serve automotive catalysts, hydrogen technologies and industrial applications.

However, restart economics will be the decisive issue. The mine was suspended because lower output weakened profitability. Any recommencement will need a stronger operating plan, stable grades, reliable processing economics and clear market support.

The Boliden agreement is an important step, but not the final decision. The project still needs operational approval, regulatory clearance and successful due diligence before concentrate flows can resume.

The Metalnomist Commentary

The ARM-Boliden agreement shows that idled nickel assets can regain value when buyers prioritise diversified and traceable supply. Nkomati’s restart will depend less on headline nickel prices alone and more on whether ARM can rebuild a reliable mine-to-smelter route.

Gold Investor Base Shift Signals Broader Move Into Hard Assets

Gold

Gold investor base expansion is becoming a wider signal for how capital may move across physical assets, including industrial metals. Speakers at the FT Commodities Summit in Lausanne said central bank buying, tokenised products and tighter traceability standards are changing the structure of the gold market.

Gold investor base growth is no longer driven only by traditional bullion buyers. Central banks, institutional investors and digital channels are bringing new liquidity, broader access and stronger strategic demand into the market.

Gold investor base changes also matter beyond precious metals. They show that investors are increasingly looking for hard assets that can act as stores of value in a fragmented geopolitical and monetary environment.

The LBMA official gold price AM fell to $4,679.80/oz on 24 April from a record $5,501.70/oz on 29 January. But speakers said the pullback does not weaken the structural case for gold as a long-term diversifier.

Central Banks and Tokenised Products Broaden Demand

Central bank buying remains the clearest signal behind gold’s structural shift. Reserve managers are becoming more sensitive to concentration risk in US dollar assets as geopolitical alliances and monetary conditions change.

Gold offers central banks an asset without direct credit risk. It also supports reserve diversification at a time when inflation, debt debasement and currency risk are shaping long-term allocation decisions.

This trend is especially visible in emerging markets. Adding domestically sourced gold to reserves can support national balance sheets while reducing dependence on foreign reserve assets.

New financial channels are also expanding access. Tokenised gold and gold-backed digital products are attracting investors who may not have entered traditional bullion markets.

Stablecoin issuer Tether has emerged as a significant physical buyer over the past 18 months, adding a new category of demand alongside central banks and institutional investors.

This matters because easier access can change market behaviour. When physical gold becomes more liquid through digital channels, its investor base can expand faster than traditional vault, bullion and exchange-traded routes would allow.

For industrial metals, the signal is important. Copper, aluminium, rare earths, gallium, germanium and other strategic materials are also becoming policy-linked assets as governments and investors focus on supply security.

Gold may therefore offer an early example of how geopolitical risk, capital flows and physical asset ownership can reinforce one another.

Traceability Becomes Essential as Physical Demand Rises

Broader gold market participation also raises the importance of standards. Higher prices can make illicit flows more attractive and increase the risk of laundering through recycled or poorly documented material.

This creates pressure for stronger traceability, refining standards and chain-of-custody systems. Buyers and regulators increasingly want to know where metal comes from, how it was produced and whether it meets responsible sourcing requirements.

The market is moving from gold of unknown origin toward gold of known origin. That transition will require transparency, technology and stricter documentation across refining and recycling routes.

The issue is especially important for artisanal and small-scale mining supply. These flows can be difficult to document, but they remain important in many producing regions.

The same traceability logic is moving into industrial metals. Strategic stockpiling, defence procurement, battery regulations and critical minerals policies are making origin and documentation more important across supply chains.

For metals markets, this means physical assets are becoming more valuable, but also more scrutinised. Capital wants exposure to hard assets, while buyers and regulators want cleaner provenance.

That combination could reshape commodity markets. The winners will be suppliers that can provide not only material, but also verified origin, reliable custody and trusted compliance.

The Metalnomist Commentary

Gold’s changing investor base shows that hard assets are becoming strategic financial instruments again. For industrial metals, the lesson is clear: capital will flow toward physical scarcity, but only trusted and traceable supply will command the strongest premium.

Valterra PGM Production Rises as South African Mines Recover From Flood Disruption

Valterra PGM

Valterra PGM production increased in the first quarter as South African mine output normalised after flooding disrupted operations a year earlier. The company produced 743,500oz of mined platinum group metals in January-March, up 7% from the same period in 2025.

Valterra PGM production was supported by higher output from the Amandelbult and Mototolo mines. Amandelbult recovered from the severe flooding that affected production in the first quarter of last year.

Valterra PGM production growth was partly offset by weaker output at Mogalakwena and Unki. Even so, refined production and sales volumes rose sharply, giving the company a stronger first-quarter operating result.

The company, previously known as Anglo American Platinum, maintained its full-year guidance at 3mn-3.4mn oz for both metal-in-concentrate and refined PGM production.

Amandelbult Recovery Lifts Mined Output

Amandelbult and Mototolo drove the increase in mined PGM output. The year-on-year comparison was helped by the normalisation of Amandelbult after flooding disrupted the mine in early 2025.

Mogalakwena remained a drag on the quarter. PGM production at the mine fell by 6% to 212,300oz because of lower milled volumes.

Unki output also declined. Production fell by 4% to 51,700oz because of the planned mining of lower-grade ore.

The mixed mine performance shows that South African PGM supply remains operationally sensitive. Weather disruption, grade variation and milling rates can all move quarterly output even when full-year guidance remains intact.

For the global PGM market, Valterra’s recovery matters because South Africa remains the largest source of primary platinum group metals. Any improvement in South African output can affect availability for automotive catalysts, hydrogen technologies, chemicals, electronics and jewellery.

Refined Output and Basket Prices Strengthen Revenue Conditions

Refined PGM production increased by 78% on the year to 778,500oz. The rise reflected higher metal-in-concentrate production and the rescheduling of annual stock counts from the first quarter to the third quarter to reduce costs.

Sales volumes rose by 60% to 791,400oz. Higher refined output and a marginal drawdown of refined inventory supported the increase.

Valterra also benefited from stronger pricing. Its average realised basket price rose by 90% on the year to $2,911/oz.

That price increase is important because PGM producers have faced years of margin pressure from volatile demand, cost inflation and weak prices in some metals. A stronger basket price can improve cash generation and support operational stability.

By-product output also increased. Nickel production rose by 41% to 5,880t, while copper output climbed by 26% to 3,845t.

These by-products matter because nickel and copper can improve mine economics. They also link PGM operations to broader battery, alloy and electrification supply chains.

Valterra’s first-quarter result therefore shows improvement across mined output, refined production, sales and by-product recovery. The key question is whether stronger operating performance can be sustained through the rest of the year.

The Metalnomist Commentary

Valterra’s first-quarter recovery shows how quickly PGM production can rebound when operational disruptions normalise. But South African PGM supply remains exposed to mine-specific risks, making stable output just as important as higher prices.

China Copper Trading Slows as Invoice Crackdown Hits Market Liquidity

China Copper

China copper trading has slowed as tax authorities intensify enforcement against circular invoicing and fraudulent metals trades. The crackdown is targeting the so-called invoice-driven economy, where companies use invoices to support fabricated or partly fabricated transactions.

China copper trading has been affected more than other non-ferrous metals because copper carries strong financial attributes. Many traders use copper invoices to support bank financing, revenue reporting and liquidity management.

China copper trading is now facing tighter scrutiny after eight government bodies, including the State Taxation Administration, held a meeting in Beijing on 16 April to co-ordinate action against tax-related crimes. Since then, inspections of trading firms have intensified nationwide.

The enforcement push is not designed to restrict normal physical trade. However, it can still reduce market activity if companies lose invoice quotas or if compliant sales become harder to process.

Copper Finance Channels Face Tighter Tax Scrutiny

The invoice-driven economy refers to irregular practices built around fapiao issuance. These can include fake transactions, inflated trade flows, tax rebate abuse and revenue manipulation.

Some companies have used these invoices to improve apparent financial performance. Others have used them to support bank loans or bond issuance by showing higher trading volumes.

Tax authorities are now cutting invoice quotas for companies that issue non-compliant invoices. In severe cases, quotas can be reduced to zero, effectively stopping firms from conducting trading activity.

This directly affects metals traders. Without sufficient invoice capacity, even legitimate transactions may be delayed or cancelled because invoices are required to complete normal commercial sales.

Copper is especially exposed because it is often used in financing structures. Its high value, liquidity and benchmark status make it attractive for invoice-backed funding.
As inspections spread, some downstream copper consumers are shifting away from traders and buying spot material directly from smelters. This reduces the role of intermediary trading firms in the physical market.

Traders’ spot offers have become firmer because sales volumes have fallen sharply. This does not necessarily mean physical copper demand is stronger. It reflects tighter trading channels and reduced willingness to sell under compliance pressure.

The crackdown could also reduce spot availability. If traders cannot issue enough invoices, some material may not move even when buyers and sellers are willing to transact.

Export Controls and Compliance Pressure Spread Beyond Copper

The compliance push is not limited to copper. China’s customs authorities have also increased enforcement against companies without export qualifications that forge or illegally purchase customs clearance certificates.

Magnesium traders said this enforcement is expected to reduce lower-priced material in the export market. Illegal magnesium exports typically evade value-added tax and income tax, allowing prices to sit $80-100/t below authorised trade.

The authorities began targeting these violations last October. The latest enforcement suggests China is tightening control over both domestic invoicing and export documentation.

This matters for industrial metals because trade flows often depend on paperwork as much as physical availability. Invoices, tax records, customs certificates and export qualifications are now becoming more important parts of market access.

For compliant producers and traders, stricter enforcement could improve market discipline. It may reduce unfair competition from firms using illegal invoicing or tax evasion to offer lower prices.

For buyers, the impact may be more complicated. Reduced informal trade can tighten availability, lift transaction costs and push more demand toward qualified suppliers.
The broader market meaning is clear. China’s metals trade is becoming more compliance-driven. This may reduce speculative or financing-led activity, but it can also lower liquidity in the short term.

For copper, the immediate effect is weaker trading activity and a shift toward smelter-direct purchasing. For magnesium and other export markets, the effect may be less low-priced material and tighter documentation requirements.

The Metalnomist Commentary

China’s invoice crackdown shows that metals liquidity can tighten even without a physical supply shock. Copper’s financing role makes it especially vulnerable, and the wider compliance push could reshape how traders, smelters and exporters manage metal flows.

CMOC Copper Output Rises as DRC Mines Strengthen China Supply

CMOC

CMOC copper output increased in the first quarter of 2026 as higher production from the company’s Democratic Republic of Congo copper-cobalt mines lifted supply. The Chinese diversified metals producer produced 187,880t of copper in January-March, up 10% from a year earlier.

CMOC copper output was supported by stronger production at the Tenke Fungurume and Kisanfu mines. These assets are central to China’s copper and cobalt feedstock security because they supply large volumes of cathode and intermediate material from one of the world’s most important copper-cobalt districts.

CMOC copper output is expected to remain a major market focus this year. The company is targeting 760,000-820,000t of copper production in 2026, after producing 741,100t in 2025.

The result reinforces the DRC’s role as China’s largest imported copper cathode source. China imported 275,359t of copper cathode from the DRC in the first quarter, equal to 37.5% of total imports.

Tenke and Kisanfu Anchor CMOC’s Copper Growth

CMOC’s first-quarter copper growth reflects the scale and strategic importance of its DRC operations. Tenke Fungurume and Kisanfu remain core assets for the company’s copper-cobalt portfolio.

The company plans to expand output at Kisanfu by adding 100,000 t/yr of copper cathode capacity. Completion is targeted for 2027.

The expansion could also lift cobalt capacity. CMOC has not disclosed the planned increase, but market participants expect Kisanfu’s cobalt capacity to rise by more than 30,000 t/yr.

This matters because copper and cobalt are increasingly linked in DRC project economics. Higher copper output can bring additional cobalt units into the market, depending on ore composition, processing rates and export rules.

The London Metal Exchange approval of CMOC’s TFM-1 copper cathode brand adds another layer of market significance. The brand, produced at Tenke Fungurume, was approved for listing on 27 March and has a registered production capacity of 270,000 t/yr.

Exchange approval improves brand visibility and market acceptance. It can also support trade liquidity, financing and customer confidence for DRC-origin copper cathode.
China’s copper cathode import structure shows why this is important. The DRC already supplies more than one-third of China’s imported cathode, making Congolese supply critical to Chinese refined copper availability.

The China grade-A copper cathode premium was steady at $55-70/t cif Shanghai on 23 April. The range narrowed from $55-75/t a week earlier, showing a relatively stable but cautious spot market.

Cobalt Output Stays Flat as Quotas Restrict Feedstock Flows

CMOC’s cobalt production was largely unchanged in the first quarter. The company produced 30,508t of cobalt, up only 0.3% from a year earlier.

The company set its 2026 cobalt output guidance at 100,000-120,000t. That is broadly stable against 117,549t produced in 2025.

The flat cobalt outlook reflects a more complicated market. The DRC suspended cobalt feedstock exports from 22 February to 15 October 2025 before moving to a quota-based export system for the fourth quarter of 2025 and for 2026-27.

Administrative delays have slowed the quota system. The DRC extended fourth-quarter 2025 quotas to 31 March 2026 because of slow processing.

The effect on Chinese imports has been severe. China imported only 1,278t cobalt metal equivalent of cobalt intermediate feedstock in January-February, down 96% from a year earlier.

Cobalt hydroxide prices remained stable at $25.95-26.10/lb cif China on 23 April. But the stability masks a market still shaped by restricted DRC export flows, delayed allocations and uncertainty over quota administration.

For CMOC, the copper side of the portfolio is showing clear growth. The cobalt side remains more exposed to policy risk, export controls and administrative timing in the DRC.

The Kisanfu expansion could increase future cobalt availability, but the market impact will depend on whether DRC export rules allow material to move smoothly to downstream refiners.

The Metalnomist Commentary

CMOC’s first-quarter results show that DRC copper remains essential to China’s refined copper supply, while cobalt is increasingly constrained by policy rather than production alone. The strategic issue is no longer just mine output, but whether export quotas, brand approvals and logistics can keep critical metal flows moving.

NextEra Battery Storage Contracts Rise as US Power Demand Accelerates

NextEra Energy

NextEra battery storage contracts increased in the first quarter as the US utility group added 1.3GW of battery storage-based agreements. The additions formed part of 4GW of renewable and storage originations, alongside 2.2GW of solar and 0.5GW of wind.

NextEra battery storage contracts are rising because US electricity demand is growing faster and customers need capacity that can be deployed quickly. The company said demand for power is not slowing and that speed to power has become essential.

NextEra battery storage contracts also show how storage is becoming a core grid resource, not only a supplement to solar and wind. Battery systems can support peak demand, improve grid reliability and provide flexible capacity as data centres, electrification and industrial load growth increase pressure on power networks.

The company added more battery storage than in the first quarter of 2025, when it originated 0.9GW of storage within 3.2GW of renewable energy and storage capacity.

Storage Pipeline Supports Fast Grid Capacity Growth

NextEra has identified four main growth routes for battery storage. These include standalone projects, co-located storage at existing renewable sites, storage as a grid solution and expansion of existing projects from four-hour to eight-hour duration.

This is important because storage demand is becoming more diverse. Standalone batteries can provide rapid capacity support, while co-located systems can improve the value of solar and wind generation.

Longer-duration battery expansion is also strategically relevant. Moving from four-hour to eight-hour systems can help utilities manage evening demand peaks, renewable intermittency and grid congestion.

NextEra’s standalone and co-located storage pipeline exceeds 110GW, excluding expansion opportunities. That scale gives the company one of the strongest platforms in the US storage market.

The growth reflects a broader shift in power infrastructure. Utilities and large customers increasingly need fast capacity additions because new gas plants, transmission lines and conventional generation projects often face long development timelines.

Battery storage is not a full replacement for all forms of generation. But it is becoming one of the fastest tools available to respond to near-term power demand growth.

Secured Supply Through 2029 Reduces Execution Risk

NextEra said it has secured domestic supply for solar panels and battery storage through 2029 at competitive prices. This reduces exposure to trade disruption, tariff changes and equipment shortages.

Supply security matters because battery storage projects depend on reliable access to cells, modules, inverters, power conversion systems, transformers and grid interconnection equipment.

South Korean battery manufacturer Samsung SDI signed a deal in March 2025 to supply 6.3GWh of battery energy storage systems to NextEra. That agreement supports the company’s ability to execute projects while demand rises.

For battery materials, the growth of utility-scale storage strengthens demand for lithium, graphite, iron phosphate cathode materials, copper, aluminium and power electronics. LFP batteries are especially important in stationary storage because of cost, safety and cycle-life advantages.

NextEra’s first-quarter profit rose to $2.18bn on sales of $6.7bn, up from $833mn in profit and $6.25bn in sales a year earlier. Stronger financial performance gives the company more room to support its renewables and storage buildout.

The industrial significance is clear. Battery storage is becoming a strategic capacity product for the US power system, especially as electricity demand from data centres, manufacturing and electrification continues to rise.

The Metalnomist Commentary

NextEra’s storage growth shows that batteries are becoming part of the core power infrastructure toolkit. The next constraint will not be customer demand, but whether supply chains, interconnection queues and grid equipment can keep pace.

Grasberg Copper Mine Recovery Delay Tightens Indonesia Supply Outlook

Grasberg Copper Mine

Grasberg copper mine recovery has been delayed after Freeport-McMoRan reported slower progress at its Indonesian operation following last year’s fatal mud rush accident. The company now expects the Grasberg Block Cave to recover more gradually than previously planned.

The Grasberg copper mine recovery delay is important because Grasberg is one of the world’s largest copper assets. Any slower restart affects global mine supply at a time when copper demand remains tied to grids, data centres, electrification and industrial policy.

The Grasberg copper mine recovery outlook has been cut because wet drawpoints increased inside the mine after the incident and subsequent suspension of mining activity. Freeport said it must upgrade ore loading infrastructure before production can recover more fully.

Freeport now expects Grasberg to reach only 65% of production capacity by the second half of this year. It previously expected the mine to reach 85% in that period.

Grasberg Restart Slows After Underground Infrastructure Issues

The progressive restart of Grasberg Block Cave has been slower than expected. The increase in wet drawpoints has limited mining activity and created a need for infrastructure upgrades.

Freeport now expects Grasberg to reach about 85% of capacity by mid-2027. The company expects the mine to approach full capacity by the end of 2027.

That marks a clear delay from the previous plan. Freeport had earlier expected Grasberg to return to full production capacity by the end of 2027.

The production impact was visible in the first quarter. Freeport’s Indonesian copper output fell by 68% on the year to 95mn lbs because of the Grasberg disruption.

Across Freeport’s global operations, copper output fell by 24% on the year to 662mn lbs. The decline shows how heavily the company’s production profile depends on a stable Grasberg recovery.

US operations partly offset the Indonesian weakness. Copper production from Freeport’s seven mines in the southwest US rose by 3% on the year to 309mn lbs.

Output from the company’s mines in Peru and Chile fell by 4.8% to 258mn lbs. Lower leach placements weighed on production across those assets.

Higher Copper Prices Offset Lower Production

Freeport’s first-quarter financial results were supported by stronger copper prices. Average copper prices rose by 30.1% on the year to $5.78/lb.

Unit production costs also improved. Freeport’s per-unit costs fell by 7.7% to $1.91/lb.

This helped offset lower production and sales volumes. Copper sales volumes fell by 25% from a year earlier, although they were 3% above Freeport’s January estimate.

Freeport’s profit more than doubled to $881mn in the first quarter. Revenue rose by 8.8% to $6.2bn.

The result shows the current copper market tension. Operational supply is weaker, but higher prices are protecting margins for major producers.

Molybdenum performance was mixed. Consolidated molybdenum production fell by 4% to 22mn lbs, while sales volumes rose by 20% to 24mn lbs.

For the copper market, the delayed Grasberg recovery adds another supply-side risk. Indonesia has been expected to support global copper growth, but mine-level disruptions continue to limit output.

The issue also reinforces a broader industry problem. Large underground copper mines can take years to stabilise after major incidents, and infrastructure bottlenecks can delay recovery even when restart work has begun.

The Metalnomist Commentary

The Grasberg delay shows why copper supply cannot be judged only by long-term resource size. A single underground disruption at a world-class mine can reshape near-term supply and strengthen copper’s strategic premium.

ICSG Copper Surplus Forecast Challenges Bullish Near-Term Market Narrative

Copper

ICSG copper surplus forecast has shifted the refined copper market outlook from deficit to surplus, challenging the more bullish tone around copper prices and strategic demand. The International Copper Study Group now expects a refined copper surplus of 96,000t in 2026 and 377,000t in 2027.

The revision marks a major change from ICSG’s October outlook, which had projected a 150,000t deficit for 2026. The new ICSG copper surplus forecast reflects weaker-than-expected demand growth and stronger secondary refined copper output.

The refined copper market is still exposed to mine disruption, lower ore grades and geopolitical risk. However, the latest forecast suggests that scrap-based production and slower consumption can offset some of the tightness from constrained mine supply.

ICSG expects global adjusted mine production to reach 23.559mn t in 2026 and 24.103mn t in 2027. Adjusted refined production is forecast at 28.76mn t in 2026 and 29.613mn t in 2027, while refined usage is expected at 28.664mn t and 29.236mn t.

Secondary Output and Slower Demand Ease Refined Copper Tightness

The biggest change in the ICSG copper surplus forecast comes from the refined side of the market. Stronger secondary output is expected to help balance constrained primary supply.

Refined copper production is forecast to grow by only 0.4% in 2026 before rising by 3% in 2027. Constrained concentrate availability will limit primary electrolytic growth this year, but solvent extraction-electrowinning and scrap-based output should provide support.

For 2027, ICSG expects primary refined copper production to rise by 2.3%, while secondary refined production increases by 5.7%. This gives scrap a larger role in balancing the market.

This matters because copper supply discussions often focus heavily on mines. But refined copper availability also depends on scrap collection, processing economics, smelter operations, SX-EW output and regional refined production.

Demand growth has also been revised lower. ICSG now expects refined usage to increase by 1.6% in 2026, down from its previous 2.1% forecast.

The downgrade reflects uncertainty from the Middle East conflict and disrupted trade flows. Chinese refined copper usage is expected to rise by 1.9% in 2026, while demand outside China grows by 1.3%.

Global refined usage is forecast to rise by 2% in 2027. Asia will remain the main growth engine, while EU and Japanese consumption are expected to stay subdued.

Asia outside Asean and CIS states will remain by far the largest refined copper-consuming region. Usage is projected at 20.469mn t in 2026 and 20.907mn t in 2027.

Mine Supply Risks Still Support Copper’s Strategic Value

ICSG’s near-term surplus forecast does not remove copper’s longer-term supply risk. The group revised down its 2026 mine production growth forecast to 1.6% from 2.3%, citing weaker growth in the Democratic Republic of Congo, Chile and Indonesia.

Output at Grasberg in Indonesia and Kamoa in the DRC remains constrained after major incidents in 2025. These disruptions show how quickly copper mine supply can tighten when large assets underperform.

Mine production growth is expected to recover to 2.3% in 2027. ICSG expects support from Chile, Zambia, Indonesia and the DRC, along with ramp-ups at Oyu Tolgoi in Mongolia, Malmyz in Russia, Julong in China and Almalyk in Uzbekistan.

Still, mine supply remains structurally difficult. Declining ore grades, slow permitting, higher capital intensity and longer project timelines continue to limit how quickly the industry can respond to higher prices.

Copper demand also retains strong strategic drivers. Energy transition investment, grid expansion, urbanisation, digitalisation, data centres and new semi-finished product capacity should continue to support long-term consumption.

This creates a split market narrative. On paper, refined copper may move into surplus in 2026 and 2027. Strategically, copper remains central to electrification, artificial intelligence infrastructure, manufacturing and industrial policy.

ICSG also warned that actual balances could diverge from forecasts. Its Chinese apparent demand calculation excludes changes in unreported stocks, including State Reserve Bureau, producer, consumer, trader and bonded inventories.

That caveat is important. Copper inventories can move through hidden channels, making the refined market appear looser or tighter than reported balances suggest.

The ICSG copper surplus forecast therefore does not end the bullish long-term copper case. It does, however, caution against assuming immediate refined scarcity when secondary supply is rising and demand outside China remains soft.

The Metalnomist Commentary

The ICSG copper surplus forecast shows that copper’s strategic story and near-term balance sheet can move in different directions. Data centres, grids and electrification support the long-term thesis, but scrap growth and weaker demand may keep the refined market looser than bullish headlines suggest.

Europe EV Growth Rises as Incentives Mask Fragile Demand Signals

Europe EV

Europe EV growth accelerated last month as battery electric vehicle sales rose by 41%, supported by tax incentives, fleet buying and carmakers’ efforts to meet emissions targets. The increase looks strong on paper, but the drivers of demand remain uneven across markets.

Battery electric vehicle sales outpaced plug-in hybrid sales, which rose by 32% across the EU, EFTA and UK. Regular hybrid vehicle sales increased by 15%, while petrol and diesel sales continued to decline across major European markets.

Europe EV growth was strongest in large markets such as France, Germany and Italy. Spain again stood out for plug-in hybrid growth, showing that national policy, consumer economics and model availability continue to shape adoption differently.

The headline growth is important for battery metals and automotive supply chains. Higher BEV sales support long-term demand for lithium, nickel, manganese, graphite, copper, aluminium and rare earth magnets.

Incentives and Fleet Orders Drive the Near-Term Recovery

Tax policy remains one of the main engines behind Europe EV growth. Several member states entered the year with revised company car rules, income-linked subsidies or accelerated depreciation schemes for electric vehicles.

These measures have favoured fleet buyers more than private consumers. Corporate fleets can respond faster to tax incentives, depreciation benefits and emissions rules because they buy vehicles in larger volumes and plan replacements more systematically.

France has tightened the link between EV support and income. Germany’s recovery has been supported by targeted incentives reintroduced in January after earlier policy volatility disrupted demand.

This matters because fleet-led growth can be less stable than broad consumer adoption. Fleet orders can lift sales quickly, but private demand is still sensitive to price, charging access, financing costs and residual value concerns.

Carmakers are also working to meet CO₂ limits. This creates another demand driver that is not purely consumer-led. Automakers may use pricing, leasing and fleet channels to push EV registrations when regulatory targets tighten.

For metals markets, the distinction matters. Stable private adoption creates more predictable battery material demand. Incentive-driven fleet demand can be more volatile if policy changes or budget support weakens.

Oil Shock Adds Uncertainty to EV Demand Outlook

Higher oil prices after the US-Iran war have revived the question of whether fuel costs are pushing consumers toward electric vehicles. However, the evidence is not yet clear.

EV demand was already rising in key markets before the oil shock. Early-year growth appears to reflect incentives, fleet orders and emissions compliance more than a direct consumer shift caused by higher fuel costs.

There is also a timing lag. Vehicle orders usually appear in sales data several weeks later, and delivery times vary by model and country. Any clear oil-price effect may not appear until June or July.

This caution is important because monthly EV data can be distorted by local registration patterns. The UK, for example, often sees a March registration spike because of its plate change system.

The broader strategic message remains clear. If Europe wants to reduce exposure to oil shocks, it needs consistent carbon rules, pollution-based taxation, charging infrastructure and long-term industrial policy.

Stop-start subsidies can create temporary sales jumps, but they can also damage market confidence. Stable rules are more useful for automakers, battery producers, charging companies and metals suppliers.

Europe EV growth therefore remains real but fragile. The region is moving away from petrol and diesel, yet the pace still depends heavily on policy design and fleet purchasing behaviour.

The Metalnomist Commentary

Europe EV growth is not yet a clean demand signal for battery metals because incentives and fleet buying are doing much of the work. The stronger long-term signal will come when private buyers adopt EVs without policy volatility or fuel-price panic.