China's Copper Dominance: Record Prices and Zero Fees

Copper prices have surged to a record $14,533 per ton on the London Metal Exchange, driven in part by China's excess smelting capacity. The 2026 miner-to-smelter treatment/refining charge (TC/RC) has settled at zero, the lowest annual deal on record, after Antofagasta agreed to this rate with a Chinese plant.

China accounts for roughly half of global smelting and more than 90 percent of the growth in smelter output since 2005, giving it significant control over the copper supply chain. Smelters in China can absorb zero fees because their economics rest on by-product revenue, physical premiums, and state tolerance for thin margins.

Beijing has responded to the fee collapse by telling smelters to cut 2026 output by more than 10 percent and halting roughly 2 million tons of planned new capacity. However, these measures are unlikely to rebalance the market, according to the International Energy Agency.