Germany’s Aurubis has held preliminary talks with the US government about support for a new copper smelter in the United States following the launch of a recycling plant there, its CEO said on Tuesday.
A new smelter is one of three options Europe’s biggest copper producer is considering to take advantage of a US drive to boost domestic output of the metal, after President Donald Trump in July announced a 50% tariff on copper products but left out ores, concentrates and cathodes.
“First we have to lay out options and come up with more concrete proposals. But we have positive signs from the US government that they would potentially support this,” CEO Toralf Haag told Reuters during metals industry gathering LME Week.
Big US demand
Last month Aurubis started production at its new recycling plant in the US state of Georgia, the first greenfield plant it has built in 115 years, which will ramp up to annual output of 70,000 metric tons of high-grade blister copper.
The US is only able to supply about half of its refined copper demand of 1.7 million tons from domestic production, with the gap widening in coming years as demand is due to jump by two-thirds to 2.3 million by 2035, Aurubis has said.
“There are 60 smelters in China, 15 in Europe, and now with us, only three in the US. So there’s a big demand for smelting capacity,” Haag said.
Building a new smelter would be a long-term project, but two other options could come to fruition in three to four years without government support, he added.
The first would be to expand the current US recycling operation by building an anode furnace and tank house to produce cathodes and possibly rods, Haag said.
The second would be to build another recycling plant on the US west coast to take advantage of higher scrap availability after the tariff ruling limited exports.
The US recycling market is expected to climb by 26% over the next decade to 555,000 metric tons a year, Aurubis has said.
Higher platinum, antimony production
Aurubis also plans to boost platinum and antimony output by building a new precious metal refinery and complex recycling plant in Hamburg together costing about 500 million euros ($577.7 million), Haag said.
Firm demand and worries about supply shortages enabled Aurubis to lift the premium it will charge European customers next year to a record $315 per metric ton, up 38% from last year, Reuters reported last week.
Supply worries from mine disruptions in Indonesia, Chile and Congo helped drive benchmark copper on the London Metal Exchange to a 16-month peak of $11,000 a ton last week. It was down 2.7% at $10,525 a ton on Tuesday morning.
($1 = 0.8656 euros)
(By Eric Onstad; Editing by Jan Harvey)
