South Korea’s Copper Concentrate Import Price Hits Record, Raising Industry Cost Fears

South Korea’s average import price for copper concentrate climbed to a record high in the first half, while import volumes fell to their lowest level in 18 years. The surge reflects resource weaponization by major economies and smelter capacity expansion in countries including China and Indonesia. That is stoking concern over a domino effect on costs for South Korean industries ranging from power equipment and semiconductors to defense.

Data from the Korea International Trade Association showed on Aug. 3 that the average import price of copper concentrate in January through June was $4,627 a metric ton. That was up 31.7% from last year’s annual average of $3,513 and marked the highest level since the data series began in 1988. Copper concentrate is ore that contains copper and is refined at smelters into copper cathode, a core industrial material.

Import volumes also slumped. South Korea imported 733,572 tons of copper concentrate in the first half, the lowest level for that period since 2008, when imports totaled 685,803 tons. Imports from Indonesia, one of the country’s main suppliers, fell to zero this year from 140,413 tons last year. South Korea has no copper mines and relies entirely on imports for concentrate.

The shortage of raw materials is pushing up costs across industry. Poongsan’s procurement price for copper cathode rose to 19.59 million won a ton in the first quarter from 14.4 million won a year earlier. The company uses copper cathode to make semiconductor copper plates, enameled wire and ammunition. Its product prices are linked to copper on the London Metal Exchange and move with international benchmarks.

Cable makers and power-equipment manufacturers are also under pressure. LS Cable & System’s copper cathode procurement cost rose to 19.09 million won a ton in the first quarter from 14.37 million won last year. Hyosung Heavy Industries’ purchase price increased to as much as 19.86 million won a ton from 13.43 million won over the same period. Copper accounts for 60% of wire and cable production costs and 25% to 40% of costs for power transformers. An industry official said cost pressure is set to intensify in the second half if global copper prices keep rising.

Even with copper prices elevated, smelters are struggling. Treatment charges paid to smelters for processing concentrate into metal have fallen to around zero this year. Spot treatment charges briefly dropped to minus $90 a ton in March. That left smelters effectively paying a premium to secure raw materials instead of collecting processing fees.

The squeeze has intensified as China, Indonesia and India expand smelting capacity with state backing, escalating competition for feedstock. Overseas smelters unable to withstand the raw-material shortage have begun shutting down. Glencore closed its Pasar smelter in the Philippines last year and later temporarily suspended operations at its Mount Isa smelter in Australia. Mitsubishi Materials also plans to halt facilities at its Onahama smelter in March 2027.

The US and China have designated copper a strategic national-security resource and moved to protect supply chains. The US has imposed a 50% tariff since August 2025 on imported copper products excluding refined copper. China has been expanding smelting capacity since announcing a copper industry development plan last year. The European Union has designated copper as a critical and strategic raw material.

In South Korea, LS MnM is the only company operating a dedicated copper smelter. Korea Zinc also recovers copper and other valuable metals from secondary materials such as electronic waste. An industry official said weakening the domestic smelting base could disrupt supply chains for semiconductors, artificial intelligence and the power industry, and urged investment in overseas mine stakes and urban mining before the opportunity passes.

An Si-uk / Song Jun-young, Korea Economic Daily reporters siook95@hankyung.com