铜行业快评：铜精矿长单加工费创历史新低，冶炼利润承压

Investment Rating - The investment rating for the copper industry is "Outperform the Market" (maintained) [2][17]. Core Viewpoints - The long-term processing fees for copper concentrate have reached a historical low, leading to pressure on smelting profits. The processing fees for 2025 have been set at $21.25 per ton and 2.125 cents per pound, significantly lower than the 2024 fees of $80 per ton and 8 cents per pound, representing a year-on-year decrease of 73.4% [3][4]. - The concentration of copper smelting capacity in recent years has resulted in an oversupply of smelting capacity relative to concentrate, which may continue to pressure processing fees. High-cost production capacity is expected to gradually reduce. Most large listed copper smelting enterprises in China are state-owned, with strong risk resistance and leading smelting technology, allowing them to maintain certain profits even under extremely low processing fees. The long-term outlook is positive due to the global clearing of copper smelting capacity [3][17]. Summary by Sections Processing Fees and Profitability - The processing fees for copper concentrate have dropped significantly, with the actual results being lower than market expectations. This has led to a potential decrease in the proportion of long-term contracts for smelting plants [4][11]. - The main sources of profit for copper smelting include smelting processing fees, recovery rates, and by-product revenues. The processing fee income for 2025 is calculated to be $132 per ton, which, when converted at an exchange rate of 7.2, equals approximately 950 RMB per ton. Assuming a smelting cost of 2000 RMB per ton, the gross profit would be -1050 RMB per ton [9][10]. Supply and Demand Dynamics - The decline in long-term processing fees is primarily due to the concentrated investment in smelting capacity, which has outpaced the increase in copper concentrate supply. By 2025, an additional 182,000 tons of copper smelting capacity is expected to come online, far exceeding the increase in copper concentrate supply [12]. - The Chinese government has issued documents to strictly control new copper smelting capacity, which is expected to improve the long-term industry landscape. This aligns with the trend of replacing high-cost inland production with low-cost coastal production [12][17]. Key Companies - Relevant companies in the copper smelting sector include Tongling Nonferrous Metals, Jiangxi Copper, and Yunnan Copper, which are expected to benefit from the long-term positive outlook of the industry [3][17].