Smelters have a couple of financial life-lines in the form of valuable byproducts such as gold and silver. They also produce sulphuric acid, which has been rising sharply in price in China thanks to demand from the phosphate fertiliser industry.
But a copper smelter’s main source of income should really be copper, which is clearly not the case right now.
A couple of Western smelters have already closed under the margin squeeze.
https://www.mining.com/web/column-copper-smelters-are-facing-both-market-and-pricing-crises/
Glencore urges Australia’s support to save Mount Isa smelter
The Mount Isa copper smelter is a cornerstone of Queensland’s economy.
Glencore (LON: GLEN) has declared its Mount Isa copper smelter unviable and is awaiting a response from Australia’s federal and Queensland’s governments regarding requests for financial assistance to keep the facility running.
The mining and commodities giant blamed “unprecedented smelting market conditions", high energy, gas and labour costs, and a shortage of copper concentrates for the smelter’s unsustainable position.
https://www.mining.com/glencore-pushes-for-australias-support-to-save-mount-isa-smelter/
Cheers
These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.
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