1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - Grasberg copper mine mudslide event impacts refined copper supply, and global refined copper supply - demand contradiction will emerge. After the event, the global copper market will face a deficit of 111,000 tons in 2025 (concentrated in Q4) and about 211,000 tons in 2026. It is expected that the copper concentrate processing fee TC will be at a low level in Q4 2025 and 2026, the refined copper premium will gradually strengthen, and the copper price center may move up [3][56]. 3. Summary According to the Directory 3.1 Indonesia's Copper Resources and Policy - **Rich Copper Resources**: Indonesia is the world's eighth - largest copper resource country, with copper reserves accounting for 3.15% of the global total. Its copper resources are mainly distributed in Papua's Grasberg mining area, North Sulawesi's Gorontalo Province, and West Sumatra [5][10]. - **Policy Improvement**: The evolution of Indonesia's mining laws, amendments, and new mining laws shows the continuous improvement of the mining development system, which promotes domestic mining investment and economic development. For example, the new mining law in 2023 aims at sustainable development, resource protection, and economic contribution, with adjustments in license regulations, environmental requirements, and tax systems [13]. - **Promoting Local Smelting**: The Indonesian government restricts raw material exports through laws and decrees to encourage foreign enterprises to build smelters locally. Although there were some relaxations in the past due to infrastructure and investment issues, the overall trend is to promote domestic smelting and value - added processing [16]. - **Low - cost Mining**: Indonesia's copper mines are mostly porphyry - type, with large reserves, large - scale open - pit mining, and rich gold content, resulting in low cash costs for copper mining. For instance, the cash cost of Grasberg copper mine in Q2 2025 was - $0.99 per pound [19]. - **Export Transformation**: Indonesia's copper concentrate exports are shifting to refined copper exports. In 2024, copper concentrate exports decreased by 129,400 tons (25% grade), while refined copper exports increased by 105,600 tons [20]. 3.2 Grasberg Copper Mine Mudslide Event - **Event Overview**: On September 8, 2025, a mudslide occurred in the Grasberg Block Cave underground mine, causing the suspension of all mining operations in the Grasberg minerals district. PTFI is investigating the cause, and the investigation is expected to be completed by the end of 2025. Production in Q4 2025 and 2026 will be significantly delayed, and it may return to the pre - event operation rate in 2027. PTFI has notified business counterparts of the force majeure situation [40][42]. - **Production Impact**: In Q4 2025, Grasberg copper mine production will be nearly zero, about 200,000 tons less than the original plan. In 2026, copper and gold production may decrease by about 35% compared to the original plan, with copper production dropping by about 270,000 tons to around 498,000 tons [48]. - **Supply - Demand Imbalance**: Assuming other conditions remain unchanged, after the Grasberg copper mine event, the global copper market will have a deficit of 111,000 tons in 2025 (concentrated in Q4) and about 211,000 tons in 2026. It is expected that the copper concentrate processing fee TC will be at a low level, the refined copper premium will strengthen, and the copper price center may move up [56].