China’s metal imports were mixed early in the year. Iron ore imports rose 10% year-on-year in January and February, despite lower steel output. China’s imports of copper ore and concentrates increased 4.9% year-on-year. Volumes averaged about 2.5 million tonnes per month, only slightly below recent months, with the Chinese New Year typically reducing early-year imports.

Raw Copper Imports Fall

Imports of raw copper and copper products fell 16% year-on-year. These shipments averaged about 350 thousand tonnes per month, below recent months. Import patterns point to rising copper production in China. This comes even as treatment and refinery charges stayed negative in February, meaning smelters paid mines a premium to refine copper. Supply risks are also noted for Congo, which accounts for 14% of global copper ore output. A blockage linked to Iran has limited sulphur exports from the Gulf through the Strait of Hormuz, which may reduce sulphuric acid availability and disrupt mining in the coming weeks. We are seeing a clear conflict between robust demand signals and a growing supply risk. China’s manufacturing PMI beat expectations at 51.2 for February, and their imports of copper ore are up nearly 5% from last year, indicating smelters are ramping up production. This is confirmed by spot treatment charges, which have fallen to record lows below -$5 per tonne as smelters pay a premium to secure scarce raw material.

Watch Congo Supply Developments

The main catalyst in the coming weeks will be the supply situation in the Democratic Republic of Congo, which is responsible for 14% of global copper output. An ongoing blockage of sulphur exports from the Gulf directly threatens the supply of sulphuric acid needed for copper extraction in the region. Early reports for February 2026 already show a 2% dip in the DRC’s copper exports, suggesting these constraints are becoming a reality. This fundamental picture supports taking a bullish position on copper futures and options. We should look at buying near-term call options, focusing on the May and June 2026 contracts to capture potential price spikes from any further news of supply disruptions. This approach offers a defined-risk way to capitalize on the upside momentum. Given that LME copper is currently consolidating around the $9,550 per tonne mark, a bull call spread might be a more prudent strategy to lower the entry cost. This would involve buying a call option and simultaneously selling another call with a higher strike price for the same expiration. This strategy would benefit from a moderate price increase, which seems highly plausible. We saw a similar setup unfold during the second half of 2025 when concerns over production in Peru and Chile drove prices higher amid steady demand. That rally demonstrated how quickly the market reprices when a major supply source is threatened against a backdrop of solid consumption. The current situation with the Congo feels very familiar to that period of upward momentum. Create your live VT Markets account and start trading now.

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