Jiangxi Copper Co is not building or investing in a previously planned project to make refined copper from scrap in eastern Malaysia, the company’s chairman Zheng Gaoqing said on Thursday.
Zheng’s predecessor Long Ziping had said in 2019 that Jiangxi Copper wanted to build the processing plant in the Malaysian state of Sabah on the island of Borneo, for easy onward shipment to top copper consumer China, but there has been no update on the scheme since.
Asked about its status in an online Q&A for investors, Zheng said Jiangxi Copper “is not building a copper recycling plant” in Sabah.
He did not provide a reason for the move, although a source with knowledge of the matter said the project was cancelled because Malaysia was following China in only allowing high-quality scrap imports, making the idea of processing low-grade scrap in Sabah impossible.
Meanwhile, Jiangxi Copper’s raw material procurement channels will be expanded based on the market situation, amid tight copper concentrate supply, Chief Financial Officer Yu Tong said.
The company’s main Guixi smelter is still profitable at decade-low treatment and refining charges (TC/RCs), which are paid to smelters to process copper concentrate into refined metal, he added, with production costs falling year after year.
Spot treatment charges in China are currently around $30 a tonne.
On copper prices, which remain near $9,000 a tonne after hitting a 9-1/2 year high of $9,617 in February, Zheng said he expected them to move at high levels due to historically low inventories and strong demand from the infrastructure and new energy sectors in China.
(By Zhang Min and Tom Daly; Editing by David Evans)