Chinese copper smelters are reaping unexpected profits from sulphuric acid sales as traditional treatment and refining charges (TC/RCs) for copper processing collapse, analysts say. A significant surge in sulphuric acid prices — driven in part by global supply disruptions such as Ukrainian drone strikes on Russia’s Astrakhan gas plant — has created substantial by-product revenue for smelters at a time when core copper processing earnings are dwindling.
Benchmark TC/RCs, which represent fees paid for converting copper concentrate into refined metal, have plunged to record lows, even turning negative, squeezing margins for the core business. In contrast, sulphuric acid prices nearly doubled by late 2025, generating an estimated $1.5 billion in revenue for Chinese smelters. At major producer Yunnan Copper, acid sales accounted for roughly one-quarter of gross profit despite being a small share of total revenue.
However, industry observers warn this reliance on a volatile by-product could prove risky if acid prices retreat. With supply responding to higher prices and demand shifts, analysts caution that any significant drop could undermine the current windfall, leaving smelters more exposed amid weak copper processing fees.