Tight Concentrate, a Near-Zero Cumulative Refined Balance in January–July

Copper supply moved in two directions in the International Copper Study Group’s September 24 release. During the first seven months of 2026, world mine production fell by about 1%, with contained copper in concentrates down 2%. Refined production still rose by about 1.7%. Mines produced less copper while processing plants increased refined output. These are preliminary figures for an elapsed period, rather than a full-year forecast.¹

The same release put the cumulative apparent refined-copper surplus for January–July at 32,000 tonnes. An estimated adjustment for changes in Chinese bonded stocks turned it into a 5,000-tonne deficit. The stock adjustment changes the sign. ICSG’s calculation of apparent use in China excludes movements in unreported inventories, including metal held by producers, consumers and merchants. The bonded-stock estimate does not fill all those gaps.²

The latest months need a closer look. The table shows unadjusted refined deficits in both June and July, alongside a negative seasonally adjusted cumulative balance for January–July. A cumulative balance near zero can coexist with recent monthly deficits. Unadjusted, seasonally adjusted and bonded-stock-adjusted balances are parallel measures, not amounts to add together; none directly answers whether end users face widespread shortages or every region has adequate deliveries. Refined output can grow year on year and still lag use.²

Concentrate feed is tight, but copper has several routes through the later stages. Ore stocks, smelting contracts, by-products, leaching and electrowinning, and scrap recovery all affect final output. Treatment charges first tell us how hard furnaces are competing for feed.

Ore has to reach the concentrator

Feed constrains the concentrators at Kamoa-Kakula. On July 29, Ivanhoe Mines reported 2.98 million tonnes of ore mined in the second quarter. The annualized quarterly mining rate was equivalent to about 70% of total concentrator capacity. These are gross ore tonnes; grades are needed to calculate the contained copper. The percentage compares mining with concentrator capacity, rather than smelter utilization. The figures cover the entire project, without adjustment for Ivanhoe’s ownership share.³

By the end of the first quarter, lower-grade surface ore stockpiles supplementing the Phase 1 and 2 concentrators had been exhausted. Increased newly mined ore replaced that supplemental feed, leaving the two plants more dependent on current mining. The disclosure concerned this particular lower-grade feed; it did not establish that every surface ore stockpile across the project had been exhausted. It had been waiting for concentration. The company’s separately disclosed unsold concentrate stocks had already passed that stage but still awaited further processing or sale. Supplemental ore can run out while other copper inventories remain; unsold concentrate can remain while underground production has yet to recover.³

Once a concentrator is built, processing capacity and the mine’s ability to supply it become separate constraints. Mining recovery, grades and usable ore determine the actual feed. Adding concentrator or smelter equipment does not automatically produce more mined copper. Kamoa-Kakula makes that constraint tangible; recovery at other mines needs its own evidence.

Ivanhoe’s year-to-year production figures also cross a processing stage. The announcement says last year’s output was reported primarily as copper in concentrate, while this year’s includes copper in anode, blister and saleable slag concentrate. As inventories move through processing and sale, subtracting the annual figures mixes in changes in measurement timing. Newly mined ore, grades and actual feed are closer to the progress of underground recovery.

Aurubis kept processing more concentrate

Mines sell concentrate to processors and pay a treatment charge, or TC, for handling it; contracts also include refining charges and other terms. Slow growth in available concentrate or faster expansion of smelting capacity leaves more furnaces competing for feed and compresses the charge.

The IEA’s July Global Critical Minerals Outlook 2026 records a 2026 annual TC benchmark of USD 0 per tonne of concentrate, based on an agreement between Antofagasta and major Chinese smelters. The fee is measured per gross tonne of concentrate, rather than per tonne of contained copper. This annual reference also differs from individual companies’ contract rates and the spot TC. The IEA links the fall in charges to Chinese smelting capacity expanding faster than concentrate production.⁴

During the first nine months of its 2025/26 financial year, from October 2025 through June 2026, Aurubis’s primary smelters increased concentrate throughput from 1.589 million to 1.906 million tonnes, again measured as gross concentrate. Operating earnings before tax in its Custom Smelting & Products segment rose from EUR 342 million to EUR 355 million. The company said lower concentrate TC/RCs hurt earnings, while sulphuric-acid revenues, the metal result and product revenues provided offsets. Throughput also benefited from a depressed comparison period: scheduled maintenance at Pirdop had reduced the previous year’s processing volume. The earnings increase cannot all be assigned to by-products, and weak treatment charges remain a drag.⁵

Several businesses share that segment. Custom Smelting & Products includes copper products and precious metals, and operating EBT is the company’s adjusted operating measure, distinct from IFRS net income. It offers no clean treatment-charge profit figure. Aurubis also says its long-term contracts leave it with minimal concentrate spot-market activity. One spot charge multiplied by total throughput remains some distance from realized income.⁵

Sulphur-bearing gases from sulphide smelting can be processed into sulphuric acid; other recoverable metals in concentrate may also earn revenue. Contracts, recovery capabilities, by-product markets and costs vary among plants. Aurubis reported these income streams as offsets to earnings pressure. A higher-cost smelter with fewer sources of revenue may face more pressure.

Depressed charges can therefore last longer: equipment under earnings pressure does not exit immediately, leaving demand for feed in place. If concentrate supply does not grow and by-product revenues weaken, some plants may shut down. TCs could then recover as feed demand contracts. Processing capacity would have shrunk to restore the balance, without mine supply necessarily improving.

Cathode has more than one route

Concentrate has to pass through smelting and refining. Suitable ore can instead undergo solvent extraction–electrowinning, or SX-EW, and become cathode directly. Scrap also has different destinations: secondary smelting and refining, or direct remelting. ICSG’s mine-production statistics include different production routes, some of which bypass conventional concentrate treatment charges.

Process comparison prepared by KSINQ from ICSG’s World Copper Factbook 2025. It does not show global production shares.⁶

For the first seven months, ICSG estimated year-on-year growth of 3.6% in SX-EW output and 4.3% in secondary refined production from scrap. These routes help explain why mined and refined output can diverge; primary supply, inventories and processing time also affect output. The figures do not isolate scrap’s contribution to the overall refined increase.¹

SX-EW still needs suitable ore, sulphuric acid and electricity. Secondary copper requires available scrap before collection, sorting, impurity management and recovery can begin. Additional scrap cannot immediately replace a new mine, and constrained acid supplies can slow leaching. The IEA’s latest outlook continues to identify these near-term risks.⁷

Other production routes and inventories offer potential buffers, though the available evidence does not establish that accessible stocks currently provide an effective one. Sustained refined-output shortfalls against use, stock drawdowns after accounting adjustments and constrained deliveries would give firmer grounds for refined-market tightness. Demand growth, refinery outages or regional distribution barriers could still explain it; attribution requires comparison with contemporaneous concentrate output, refinery feed and outage timing. ICSG has already reported recent monthly deficits. Widespread delivery shortages and mining’s independent contribution remain unconfirmed by those figures.

The 2035 gap has already been revised

Long-term mine supply runs on another horizon. The IEA compares base-case output from existing and announced projects with primary supply requirements under the Stated Policies Scenario, or STEPS. Its estimated 2035 gap is around 25%. Primary requirements deduct secondary supply and account for refining losses, using a different definition from total end-use demand. The gap does not measure a shortfall in refined copper available today.⁷

The estimate has narrowed from approximately 30% in the previous edition. The IEA attributes the revision to project progress and improved supply prospects in countries including the Democratic Republic of the Congo and Zambia. Projects can advance, mine lives can change, and recycling and material intensity can shift. The modeled gap moves with these changes; actual production still depends on progress at the mines. The same report warns that slow mine recoveries and acid constraints have worsened the short- and medium-term outlook. The narrowing 2035 gap and the weaker near-term supply outlook appear in the same report.⁷

Sources checked through October 4, 2026. ICSG figures are preliminary; company figures cover their disclosed reporting periods; historical operating results do not represent future performance; the IEA’s long-term gap is a scenario-model estimate. Published by KSINQ as personal research and opinion for informational purposes only. Not investment advice. Aurubis and Ivanhoe Mines appear solely as industry case studies; their inclusion is not a recommendation concerning their securities.

Footnotes

1. International Copper Study Group, September 24, 2026, Copper: Preliminary Data for July 2026, PDF p.1. Growth figures are preliminary cumulative January–July 2026 comparisons with the prior year. ↩ ↩²

2. The same ICSG public release, PDF pp.1–2: cumulative and monthly balance rows, China’s apparent-use calculation and estimated bonded-stock adjustment. Adjustments are parallel preliminary measures, not amounts to add; they do not directly measure delivery failures. ↩ ↩²

3. Ivanhoe Mines, July 29, 2026, second-quarter operating update and official PDF, pp.10–11. Lower-grade stockpiles refer to supplemental Phase 1 and 2 feed; mining rates, inventories and production measurements are separate disclosures. ↩ ↩²

4. International Energy Agency, July 16, 2026, Global Critical Minerals Outlook 2026, official PDF, pp.129–132; official Outlook page. Annual benchmarks, spot charges and company realized income are distinct. ↩

5. Aurubis, August 6, 2026, Quarterly Report First 9 Months 2025/26, pp.2–3, 8–9 and 21. Operating measures, offsets, contracts and maintenance effects are company disclosures, rather than independently isolated causal contributions. ↩ ↩²

6. International Copper Study Group, The World Copper Factbook 2025, printed pp.3 and 10 / PDF pp.8 and 15: process and statistical definitions. ↩

7. IEA, Global Critical Minerals Outlook 2026, official PDF, pp.134–137; official Outlook page and chart notes. The 2035 scenario, edition-to-edition revision and nearer-term risks address different horizons. Report license: CC BY 4.0. This license notice and statement cover all content in this article derived from the cited IEA report. Such material is a derivative work prepared by KSINQ from IEA material. KSINQ alone bears full liability and responsibility for that derived work. The IEA and its Member countries provide no endorsement of this derived work, in any manner. ↩ ↩² ↩³