- Chinese copper smelters have seen revenue surge from byproducts
- Sulphuric acid prices jumped even before the Iran war
- China's acid prices may face pressure after Beijing's export ban
- Processing fees for copper concentrate still falling
April 14 (Reuters) - China's copper smelters will likely press ahead with plans to trim output as Beijing's ban on sulphuric acid exports tames a price rally in the byproduct that had offset falling processing fees, industry insiders and analysts said.
Smelters in China, the world's largest copper producer, have since last year seen revenue surge from byproducts including sulphuric acid, helping mitigate a plunge in the processing fees paid by miners to refine copper linked to an acute shortage of concentrate.
Sulphuric acid prices had risen sharply on growing battery sector demand even before the start of the Iran war in late February, which disrupted commodity shipments through the Strait of Hormuz.
However, they may come under pressure as Beijing's pending ban on outbound acid shipments leaves more availability at home, analysts said.
At least three analysts and two copper processors said smelters will have to trim output if prices of sulphuric acid slow their climb or fall while processing fees are still tumbling.
"Acid prices may slow down their rising pace or even flip into a fall, but neither is good for us," said an official with a Chinese smelter, declining to be named as they were not authorised to speak to media.
China's spot treatment charges for imported copper concentrate hit a historic low of minus $77 a ton on April 10 from minus $76.7 a week earlier and minus $28.6 at the same time last year, data from information agency Argus showed.
CHINA TO HALT SULPHURIC ACID SHIPMENTS FROM MAY, SOURCES SAY
China will halt exports of sulphuric acid from May, two sources with knowledge of the matter said, after introducing a quota system earlier this year to rein in exports and ensure supply for domestic fertiliser in the spring season.
Exports were down 50% in the first two months of 2026, customs data showed. The likely export ban was reported earlier by Bloomberg News.
The move is Beijing's latest since the start of the Iran war to curb exports of key commodities, including refined fuels and fertilisers.
China's Ministry of Commerce, state planner, and the China Sulphuric Acid Industry Association did not respond to requests for comment.
BRINGING FORWARD MAINTENANCE?
China's copper smelters industry group said last year that dozens of top smelters had agreed to cut production in 2026 partly to counter falling processing fees. However, output in the first two months rose 9%, and some smelters plan to raise or maintain output this year.
Chinese smelters may now opt to bring forward planned maintenance to manage lower byproduct revenue and mitigate inventory risks caused by a halt to sulphuric acid exports, said Ronan Murphy, head of base metals pricing at Argus.
"It reflects that high byproduct prices have limited the requirement for smelters to reduce output even in the face of a collapse in treatment charges. This may start to change now," said Murphy.
Beijing's sulphuric acid export halt will leave buyers dependent on Chinese supply scrambling for alternatives in a market further tightened by the Iran war.
China, the largest exporter of sulphuric acid, shipped 4.65 million tons last year, with 32% and 15% flowing to Chile and Indonesia, respectively.
Reporting by Amy Lv in Beijing and Tony Munroe in Singapore; Additional reporting by Dylan Duan in Shanghai; Editing by Jan Harvey
Source: Reuters