The 2026 annual copper TC/RC benchmark has settled at effectively $0/t, the lowest in history. Concentrate tightness from mine disruptions in Chile, Indonesia, and DRC has given miners unprecedented leverage over smelters.
Chinese smelters face an existential margin squeeze. At TC/RCs of $0/t, processing fees cover no smelter costs. Plants survive only through by-product credits from gold, silver, and sulfuric acid.
The supply crisis originates on the mine side. Long disruptions at Grasberg (Indonesia), Kamoa-Kakula (DRC), El Teniente and Quebrada Blanca (Chile), and Cobre Panama have constrained concentrate availability.
Fastmarkets describes the 2026 benchmark talks as the most difficult in memory, with fragmented pricing and index-linked deals replacing the traditional annual benchmark.
If sulfuric acid or precious metal prices weaken, Chinese smelters will cut refined production. Contracting strategies should include supplier diversification and smelter operating rate monitoring.
If sulfuric acid or precious metal prices weaken, Chinese smelters will cut refined production. Contracting strategies should include supplier diversification and smelter operating rate monitoring.