New Delhi: Indian billionaire Gautam Adani’s conglomerate has recently finalized contracts to purchase 1.6 million tons of copper concentrate annually, marking a significant move for the world’s largest single-location smelter dedicated to this industrial metal. Dr. Vinay Prakash, CEO of Adani Natural Resources and Managing Director of Kutch Copper Ltd., revealed that the initial phase of this ambitious project, boasting a capacity of 500,000 tons, is poised to commence operations next month at the impressive $1.2 billion facility situated in Mundra, Gujarat, within the western reaches of India.
As per Dr. Prakash’s projections, this capacity will undergo expansion, reaching 1 million tons by March 2029, strategically aligning with the anticipated doubling of Indian copper demand by the decade’s end. Adani Enterprises Ltd., the flagship company within the conglomerate, has strategically initiated this endeavor to secure vital resources, particularly critical minerals, and is reinvigorating capital expenditure efforts to support this ambitious venture.
Interestingly, the timing of the smelter’s inauguration coincides with a tumultuous period in the global copper market, characterized by a collapse in the fees charged by processors to miners due to a shortage of ore supply. Dr. Prakash pointed out that the confluence of high operational costs and dwindling fees could compel smelters and refiners worldwide to curtail production. However, he expressed confidence in the competitiveness of their plant, emphasizing its designation as a low-cost producer with superior metal recovery capabilities.
Dr. Prakash also disclosed that the contracts for copper concentrate procurement encompass a blend of short- and long-term agreements, although specific suppliers remain undisclosed. Furthermore, he highlighted the potential for an increase in concentrate supply over the medium to long term, particularly with the advent of more mining projects, including those in Africa and Peru, coming online.
This venture underscores Adani Group’s commitment to diversifying its portfolio and securing critical resources, while also contributing to India’s burgeoning industrial landscape and meeting the nation’s escalating demand for copper.