LS MnM Inc. is weighing lower copper concentrate purchases at its Onsan smelter as weak processing fees pressure profitability and raise the prospect of reduced refined copper output.
The review will take account of purchase terms, market conditions and operational efficiency, Reuters reported Oct. 19. LS MnM has announced no reduction in purchases or production and set no timetable for a decision.
Smelters typically receive treatment and refining charges for converting mined concentrate into refined copper. The International Energy Agency (IEA) said the annual benchmark treatment charge for 2026 settled at $0 per metric ton in January, while spot charges have been negative since 2024. It linked the pressure to smelting capacity growing faster than concentrate production, leaving processors that buy their feed on the market particularly exposed.
Lower charges can benefit miners selling concentrate. Antofagasta reported a $48.4 million positive effect on revenue in the first half of 2026 from the decline in treatment and refining charges.
LS MnM lists annual capacity of 680,000 metric tons of electrolytic copper, a figure The Korea Times attributes to its Onsan plant in Ulsan, South Korea. Higher byproduct yields and greater use of recycled feed are among the options LS MnM is examining, the newspaper reported. The company told The Korea Times that processing less concentrate may leave it with less sulfuric acid and copper cathode to sell. It said it would give priority to long-term customers.
Other smelters face similar pressure. Mitsubishi Materials Corporation said in a March filing that it would suspend copper concentrate processing and related smelting operations at its Onahama site in Japan by around the end of March 2027, citing weaker purchase terms and competition from overseas smelters. Its electrolytic refining plant will continue operating.
