At the peak of high copper prices, Jiangxi Copper is offering "evidence" of supply shortages: ambitious plans to significantly increase production in the next decade.

The Jiangneng Jinya Corporation announced that in the next ten years, the company plans to increase its annual copper production to around 1.6 million tons by 2035 in order to reverse the current decline in copper production. This comes at a time when global mining companies are ramping up copper production, but the company's own copper production has been declining for the fourth consecutive year. The company's copper production for this year is expected to decrease by about 40% compared to 2018. Jiangneng Jinya also reiterated a plan to increase copper production to 1 million tons by 2028 and announced that they will restart the Alumbrera mine as part of this plan. Currently, Jiangneng Jinya is expecting a copper production range of 850,000 to 875,000 tons by 2025. Despite recent declines in production due to reasons such as lower grade ore, the company remains optimistic about future growth prospects. At the same time, copper prices are currently at a historical high, exceeding $11,400 per ton on Wednesday. The price of this metal has risen by about 30% this year, as multiple mining site shutdowns due to accidents have led to supply shortages, and many investors are bullish on the metal as it plays a crucial role in electrification and energy transition. One of the main reasons for the surge in copper prices is the widespread market expectation of long-term structural shortages in copper supply due to global energy transition, growth in demand for artificial intelligence (AI) infrastructure, as well as electric vehicles. Jiangneng Jinya's increase in production directly responds to the market's demand for additional supply. UBS predicts that global copper demand will increase by 2.8% in 2025 and 2026. Factors driving growth include the popularity of electric vehicles, investments in renewable energy, expansion of power grids, and the booming development of data centers. Electric vehicles, high-voltage transmission lines, wind energy plants, solar energy plants, and data infrastructure all require large amounts of copper, making it a key industrial material for decarbonization. The CEO of Jiangneng Jinya has pointed out that by 2050, global copper supply will need to increase by 1 million tons per year to meet expected demand, and therefore the company's increase in production will help fill this significant gap. Most of Jiangneng Jinya's new production will not start to gradually release until after 2026, especially projects like Alumbrera, which are expected to start production by the end of 2026. This means that in the next one to two years, the market will still mainly face the current supply shortage situation. Jiangneng Jinya's production expansion plan mainly indicates the market's strong confidence in the long-term demand for copper, and the high copper prices are gradually stimulating new supply. Although this provides a kind of "brake" signal for the long-term rise in copper prices, in the short term, the tight supply situation may continue to support high copper prices or even continue to rise.