Adani’s billion dollar copper plant runs dry: India’s metal push faces global roadblock
Gautam Adani’s $1.2 billion copper smelter in Gujarat is struggling to secure enough raw material to run at full strength, importing less than 10 percent of the required ore since it began operations in June, Bloomberg reported.
Kutch Copper Ltd., a unit of the Adani Group, has imported only about 147,000 tons of copper concentrate in the ten months to October, compared to the 1.6 million tons needed annually to operate the plant at full capacity, according to customs data cited by Bloomberg. In contrast, rival Hindalco Industries Ltd. brought in over 1 million tons during the same period.
Business Today could not confirm or independently verify these figures. The Adani Group has not responded to the story by Bloomberg.
The plant’s raw material shortfall comes amid a global squeeze in copper supply triggered by disruptions at key mines operated by Freeport-McMoRan, Hudbay Minerals, Ivanhoe Mines and Chile’s state-run Codelco. Simultaneously, China’s aggressive expansion of its smelting industry has collapsed refining margins worldwide, pushing some facilities to scale back or shut down.
The tight supply has driven treatment and refining charges to record lows, as smelters scramble to secure feedstock despite shrinking profits.
For Kutch Copper, which aims to double capacity to 1 million tons per year within four years, the slow ramp-up means increased operational costs and delays in reaching profitability.
“Adani’s smelter is new and so should be more efficient than many competitors, so in the short term the smelter could ramp up at a loss,” said Grant Sporre, a Bloomberg Intelligence analyst. He noted that India could respond by hiking tariffs to support its domestic metals industry, accepting short-term losses for long-term strategic gains.
According to customs data, Kutch Copper has received 4,700 tons from BHP Group, with additional shipments from Glencore and Hudbay.
India’s limited ore reserves and booming demand from construction, power and infrastructure are intensifying pressure on local metal producers to bridge the resource gap.
