Despite copper prices trading near record highs, the value of the metal to copper smelters has fallen sharply following an unprecedented collapse in ore treatment and refining charges.

Companies that convert mined copper concentrates into refined metal are now increasingly relying on by-products generated during the processing stage to remain financially viable.

Secondary products such as gold, silver, and sulfuric acid have become nearly as important as copper itself in determining profitability for traditional smelters.

This unusual situation stems from China’s rapid expansion of copper smelting capacity, which has significantly outpaced the ability of global mines to supply sufficient raw materials.

The imbalance is unlikely to disappear anytime soon. Mine production remains constrained, and despite discussions about output cuts at Chinese smelters, the country’s refined copper production continues to rise.

The shift carries major implications for the copper concentrate market and the future structure of global copper production.

Negative treatment charges reshape smelter economics

Annual benchmark copper treatment and refining charges (TC/RCs) have collapsed from $80 per metric ton and 8 cents per pound in 2024 to $21.25 per ton and 2.125 cents per pound in 2025.

This year, benchmark charges have effectively fallen to zero.

Spot treatment charges have remained negative for several months, meaning smelters are effectively paying mining companies for the right to process copper concentrates.

As a result, the headline TC/RC figures have become increasingly irrelevant. What now matters most is the value assigned to precious metals contained within concentrates, as well as sulfur that can be extracted and converted into sulfuric acid.

Rising gold and silver prices have helped offset the loss of a key revenue source for smelters.

Sulfuric acid has provided even greater support, aided by disruptions to Gulf supplies caused by the war with Iran and the closure of the Strait of Hormuz.

In fact, some Chinese copper smelters have begun processing larger quantities of pyrite, commonly known as “fool’s gold,” simply because it contains higher sulfur content.

Consultancy CRU estimates that treatment charges accounted for 39% of total smelter revenue in 2018.

By last year, however, the largest revenue contributors had become “free metal” gains and by-product credits, particularly sulfur. The former accounted for roughly 50% to 53% of revenues, while the latter contributed around 25% to 27%.

“Free metal” refers to the difference between the payable metal content in raw material and the actual recovery rate achieved by the smelter for copper and other metals.

Has the era of annual benchmark pricing come to an end?

One of the most striking aspects of the transformation in the copper smelting industry is how quickly it occurred.

The shift reflects both the speed and scale of China’s expansion in copper processing capacity.

China’s refined copper output rose 8% year over year to 14.72 million metric tons in 2025.

By comparison, global mine production increased by just 1%, according to the International Copper Study Group.

China’s Copper Smelters Purchase Team (CSPT), which includes the country’s largest producers, agreed in November to cut production by 10% this year in an effort to halt the collapse in treatment charges.

However, actual output rose 7.4% year over year between January and April 2026, according to China’s National Bureau of Statistics.

The rapid transformation of the copper concentrate market is prompting participants to reconsider the industry’s reliance on annual benchmark agreements for pricing.

Chilean mining company Antofagasta has proposed shifting to spot-index pricing during its semiannual negotiations with Chinese smelters, according to local data provider Shanghai Metals Market.

CSPT, which recently added new members to strengthen its bargaining power, is likely to oppose the move. But without meaningful Chinese production cuts, the gap between annual benchmark prices and actual market conditions is likely to widen further.

Survival of the fittest in the global smelting industry

The key question now is whether this new financial model for smelters can remain sustainable over the medium term.

For smelters equipped with modern technology, capable of achieving high precious-metal recovery rates, and supported by reliable sulfuric acid sales channels, the model may remain viable.

CRU noted that “the collapse in treatment and refining charges has been painful on paper but manageable in practice” for such facilities.

However, the consultancy warned that “the outlook is far darker for smelters with aging infrastructure, high fixed costs, or geographical disadvantages in sulfuric acid marketing.”

These facilities remain far more dependent on treatment charges because they lack the competitive advantages enjoyed by newer operations.

Many of those smelters are located outside China, posing an additional threat to a segment of the Western copper supply chain that is already under pressure.

Glencore has already placed its smelter in the Philippines under care-and-maintenance status, while it only committed to keeping its Australian smelting operations running after securing a rescue package worth A$600 million, equivalent to roughly US$395 million, from federal and state governments.

Meanwhile, China accounted for around half of global refined copper production in 2025, up from just 15% in 2005, and is expected to gain further market share this year.

Chinese smelters appear fully aware that they are engaged in a battle in which only the strongest will survive.

The challenge for the West is that its smelting industry could emerge as one of the biggest casualties of China’s fierce competition for raw materials and revenue streams in a concentrate market that remains structurally short of supply.

Bitcoin dropped below the $60,000 level for the first time since late 2024, triggering a fresh wave of concern among cryptocurrency investors around the world.

On June 24, 2026, the world's largest cryptocurrency by market capitalization fell to around $59,100 before recovering a small portion of its losses.

For comparison, Bitcoin reached its all-time high of $126,272 in October 2025, meaning the current price represents a decline of more than 50% from that peak.

The selloff was not driven by a single factor. Instead, it resulted from a combination of economic and crypto-specific pressures that converged at the same time. This report examines the key drivers behind Bitcoin’s decline, the technical significance of the $60,000 level, and what investors in the UK should know.

What caused Bitcoin’s price collapse?

Bitcoin’s drop below $60,000 was driven by a mix of broader economic factors and cryptocurrency market developments that intensified selling pressure.

Rotation out of AI-related stocks

The immediate catalyst was a sharp two-day selloff in semiconductor and artificial intelligence-related stocks.

When traders reduce risk exposure, they typically sell their most speculative assets first, and Bitcoin is often viewed as one of them.

As institutional investors pulled liquidity from AI-related trades, Bitcoin became caught up in the broader wave of selling.

Record outflows from Bitcoin ETFs

Bitcoin exchange-traded funds (ETFs), which allow investors to gain exposure to the cryptocurrency without directly owning it, recorded approximately $469 million in outflows on June 24, 2026 alone.

BlackRock’s IBIT fund accounted for roughly $239 million of those withdrawals.

Over the past month, total net outflows from Bitcoin ETFs have reached approximately $6.4 billion.

When investors redeem ETF shares, issuers are often required to sell corresponding Bitcoin holdings to meet redemption requests, creating automatic selling pressure regardless of market price levels.

Concerns over delays to the US CLARITY Act

Investor sentiment was also hurt by reports suggesting that the US CLARITY Act, a long-awaited regulatory framework for the cryptocurrency sector, could face delays.

Regulatory uncertainty has historically weighed on Bitcoin prices, as institutional investors typically require clearer rules before committing significant capital to the market.

Selling by long-term Bitcoin holders

Analysis from Compass Point Research indicates an increase in selling activity among long-term Bitcoin holders, defined as investors who have held the cryptocurrency for six months or longer.

The firm described the pattern as “a typical sign of late-cycle market capitulation.”

This type of selling often precedes a market bottom, although it can also accelerate downside pressure in the short term.

Crude oil prices fell more than 3% on Friday and were on track for sharp weekly losses as supply concerns continued to ease with more stranded tankers leaving the Strait of Hormuz, despite a cargo vessel being struck near Oman on Thursday.

Brent crude futures fell $2.61, or 3.47%, to $72.65 a barrel by 10:37 GMT. US West Texas Intermediate crude futures dropped $2.46, or 3.42%, to $69.46 a barrel.

Brent was heading for a weekly decline of around 9.8%, while WTI was trading about 9.3% lower than last Thursday’s close, ahead of market closures for last Friday’s public holiday.

“The dominant market view still appears to be that an oil supply glut is likely to emerge soon,” said Tamas Varga, analyst at PVM.

Shipping data from the London Stock Exchange showed that Saudi oil giant Saudi Aramco resumed crude loadings on Friday at its Ras Tanura terminal in the Gulf after a suspension that lasted nearly four months.

The data showed that two very large crude carriers (VLCCs), each capable of loading up to two million barrels, had begun taking on cargoes from the terminal, while another tanker was waiting nearby.

Supply concerns ease despite Strait of Hormuz tensions

“There is broad-based selling across the market as traders react to rising oil flows out of the Strait of Hormuz, while Chinese crude demand has yet to show any meaningful increase,” said June Goh, Senior Oil Market Analyst at Sparta Commodities.

The two oil benchmarks had climbed more than 2% on Thursday after a cargo vessel was struck by an unidentified projectile near Oman, prompting the United Nations shipping agency to suspend its voluntary evacuation program.

Two US officials told Reuters that Iran fired on the vessel as it attempted to transit the Strait of Hormuz. Iranian authorities, meanwhile, said the safety of ships operating outside designated routes in the strait could not be guaranteed.

Data released on Thursday showed crude shipments through the Strait of Hormuz rose this week to their highest level since the outbreak of the US-Israeli conflict with Iran in February, supported by the ceasefire agreement that reopened the waterway, although total traffic remains well below pre-war daily averages.

“If transit volumes fail to increase further over the coming week, market skepticism is likely to grow, which could result in another rise in oil prices,” Commerzbank analysts said on Friday.

Separately, Russian authorities are considering imposing a ban on diesel exports for several months, according to Russia’s state news agency TASS on Friday.

Russia is one of the world’s largest diesel exporters, but it has faced fuel supply disruptions following a wave of Ukrainian drone attacks targeting oil refineries and other energy infrastructure across the country.

The US dollar fell against most major currencies on Friday as expectations for additional Federal Reserve rate hikes eased slightly following the latest economic data and lower oil prices, allowing the Japanese yen — which remains in a zone that could trigger official intervention — to regain some strength.

Despite the decline, the dollar remained on track to end the week higher and was still heading for its strongest monthly performance since July 2025, with gains of just over 2.3%.

Data released on Thursday showed that one of the key US inflation indicators came in line with economists’ expectations. At the same time, oil prices fell more than 3% on Friday, helping cool market expectations for further interest rate increases.

Dollar selling is expected to remain limited for now, as investors continue to focus on interest rate differentials among major economies. Traders still expect the Federal Reserve to raise rates given the strength of the US economy, while lower energy prices have pushed back expectations for near-term policy moves by institutions such as the European Central Bank.

“We’ve seen some profit-taking, perhaps related to month-end flows, but I think the current dollar move could extend a little further,” said Nick Kennedy, FX strategist at Lloyds Bank in London.

“Overall, interest rate differentials are once again driving market movements,” he added.

The US Dollar Index, which measures the greenback against a basket of six major currencies, fell 0.3% to 101.19 after gaining momentum during the European session in London.

The index had already pulled back slightly from the more-than-one-year high reached earlier this week.

The euro rose about one-third of a percent to $1.13321, while sterling gained 0.25% to $1.3219.

US money markets are fully pricing in a 25-basis-point Federal Reserve rate hike by the end of the year.

Japanese yen remains in the danger zone amid intervention concerns

The Japanese yen rose 0.1% against the dollar to ¥161.60 per dollar after weakening to a two-year low of ¥161.95 on Thursday. A move beyond ¥161.96 would place the Japanese currency at its weakest level since 1986.

Many market participants view a move beyond ¥160 per dollar as a red line for Japanese officials that could trigger intervention in the foreign exchange market.

Several banks rushed to revise their forecasts for the timing of the next Bank of Japan rate hike after data released on Friday showed Tokyo core inflation accelerated in June, providing additional support for the yen.

Kamal Sharma, Head of G10 FX Strategy at Bank of America, said there are reasonable arguments for why Japanese authorities have not intervened so far.

“The yen is not the currency experiencing the most significant move. By G10 standards, we have not seen particularly sharp or excessive moves specifically tied to the yen,” Sharma said.

He added: “The market is positioned short yen, but the pace of the move may not yet justify intervention.”

USD/JPY has risen only 0.17% so far this week.

In other currency markets, the Australian dollar slipped 0.14% to US$0.6901.

Meanwhile, Bitcoin edged up 0.2% to $59,481, trimming earlier gains after falling earlier this week to its lowest level since September 2024.