Gautam Adani’s ambitious $1.2 billion copper smelter project in Gujarat is struggling to secure the raw materials needed to operate at full capacity, highlighting a growing challenge for India’s metals sector as global supply constraints deepen.
According to a Bloomberg report, Kutch Copper Ltd — the Adani Group subsidiary operating the plant — has managed to import less than 10% of the required copper concentrate since operations began in June. Customs data cited in the report shows the company imported around 147,000 tons of concentrate between January and October, far short of the 1.6 million tons needed annually for full-scale operations.
In comparison, rival smelter Hindalco Industries imported more than 1 million tons over the same period. Business Today was unable to independently verify the figures, and the Adani Group has not issued a statement on the report.
Global squeeze hits India’s metal ambitions
The supply shortfall comes amid a global copper crunch triggered by production setbacks at major mines operated by Freeport-McMoRan, Hudbay Minerals, Ivanhoe Mines, and Chile’s state-owned Codelco. At the same time, China’s rapid expansion of its smelting capacity has sharply reduced refinery margins worldwide, forcing some plants to scale back or shut down.
With treatment and refining charges plunging to record lows, smelters around the world are scrambling to secure feedstock even as profitability erodes.
For Kutch Copper — which plans to double capacity to 1 million tons a year within four years — the slower-than-expected ramp-up could delay profitability and raise operating costs.
“Adani’s smelter is new and should be more efficient than many competitors, so in the short term the smelter could ramp up at a loss,” said Grant Sporre, an analyst at Bloomberg Intelligence. He added that India may consider increasing tariffs to protect its domestic metals sector, even if it results in short-term financial strain.
Customs data indicates shipments received so far include 4,700 tons from BHP Group, along with additional supplies from Glencore and Hudbay.
With India’s ore reserves limited and demand rising rapidly across construction, power, and infrastructure, domestic metal producers face mounting pressure to close the widening raw material gap.