HK Stock Market Move | Jiangxi Copper (00358) is currently down over 4% as a result of a decline in copper concentrate processing fees dragging down gross profit. Institutions predict that the overall impact is manageable.

Jiangxi Copper (00358) is currently down over 4%, by the time of the report, it is down by 3.91%, at 30 Hong Kong dollars, with a trading volume of 2.62 billion Hong Kong dollars. In terms of news, Jiangxi Copper previously released its performance, with the company's operating income in the third quarter reaching 139.088 billion yuan, a year-on-year increase of 14.09%; net profit of 1.849 billion yuan, a year-on-year increase of 35.2%; non-net profit attributable to shareholders of 1.91 billion yuan, a year-on-year increase of 94.7%. The company's gross profit in the third quarter was 4.08 billion yuan, down by 1.1 billion yuan from the previous quarter, mainly due to the decline in copper concentrate smelting and processing fees. Guosen released a research report stating that global copper concentrate supply is becoming increasingly tight. Currently, the spot processing fee and the long-term processing fee are diverging, with the spot processing fee below -$40 per ton and the long-term processing fee at $21 per ton. Smelters are still profitable using only the long-term contracts, but if they use some spot contracts, smelting profits will be affected. For Jiangxi Copper, the cathode copper production target for 2025 is 2.37 million tons, estimated production in the first three quarters is 1.8 million tons, with production pressure in the fourth quarter not significant. In addition, the company can flexibly choose the ratio of copper concentrate and cold materials use, and it is expected that processing fee pressure will not significantly increase in the fourth quarter.