India's primary copper production surges 25% y-o-y in FY'26. What's driving the new wave of expansion?

• Hindalco's output rises 10% y-o-y, Sterlite grows 33%
  
  
• Kutch Copper ramp-up contributes around 0.05 mnt
  
  
• Import reliance persists despite capacity expansion
  
  

Morning Brief: India's primary copper industry in FY'26 is entering a new growth phase, supported by capacity additions and strategic investments aimed at strengthening domestic supply.

Total refined copper production through the primary route stood at around 0.7 million tonnes (mnt), registering a robust growth of approximately 25% y-o-y compared to 0.56 mnt in FY'25. The growth is primarily driven by the ramp-up of new capacity at Kutch Copper and steady operations at existing players.

Production landscape dominated by a few key players

India's refined copper production continues to be concentrated among a few major players, although the competitive landscape is gradually evolving. Hindalco Industries remains the largest producer, with output rising 10% y-o-y to around 0.45 mnt in FY'26, compared to 0.41 mnt in FY'25.

Vedanta's Sterlite Copper also reported a strong 33% growth in output to around 0.20 mnt in FY'26 compared to 0.15 mnt in FY'25, driven by improved operating performance.

A key development in FY'26 has been the entry of Adani Enterprises' Kutch Copper Limited, which contributed around 0.05 mnt, compared to negligible output in FY'25. This marks a significant addition to Indias refining capacity and signals the beginning of a new supply phase.

Meanwhile, Hindustan Copper Limited continues to play a strategic but limited role, having shifted its focus primarily toward mining since 2020 due to refining non-viability.

The industry continues to reflect the long-term impact of the Tuticorin smelter closure in 2018, which previously accounted for nearly 56% of Indias refined copper output. The closure led to the countrys transition from a net exporter to a net importer.

Expansion pipeline

A strong pipeline of investments is underway to enhance India's refining and raw material capabilities. Hindalco is investing around INR 2,450 crore in Gujarat, including expanding its Dahej smelter capacity by 50-60%, adding roughly 0.25-0.28 mnt. Alongside this, investments in downstream and recycling facilities will position Dahej among the largest copper smelting complexes outside China, with an e-waste recycling plant processing 0.3-0.35 mnt of scrap annually and recovering 50,000 tonnes (t) of copper initially.

Kutch Copper Limited has already commenced operations with an initial capacity of 0.5 mnt and has outlined plans to expand this to 1 mnt, making it one of the largest single-location copper refineries globally. This scale-up is expected to significantly improve domestic availability over the medium term.

Upstream integration is also gaining momentum, with JSW Group entering the copper value chain through a long-term mine development agreement with Hindustan Copper for two Jharkhand blocks. With a combined capacity of around 3 mnt/year of ore, these mines are currently under development and are expected to support future smelting operations, strengthening raw material security over the medium term.

Lloyds Metals and Energy Limited are entering the copper value chain through upstream and refining investments. The company has already commissioned a 12,000 tonnes (t)/year copper cathode plant in the Democratic Republic of Congo, with plans to scale this up to 30,000 t/year in the medium term, supported by captive mining assets.

Lloyds Metals and Energy has also partnered with Virtus Minerals to acquire Congo-based Chemaf, a copper and cobalt mining company capable of producing of 75,000 t/year of copper cathodes.

Indo Asia Copper is also understood to be expanding its presence in the copper segment, with plans to establish a new copper refining plant in Gujarat. The proposed facility is expected to produce around 35,000 t/year of copper cathodes, positioning the company among the emerging players in India's downstream copper market, after large-scale entrants such as Adani.

This move highlights India's intent to secure upstream access to essential resources such as copper, which are vital for electric vehicles, renewable energy, and battery manufacturing.

Demand drivers reflect broad-based growth across sectors

India's end-use sectors are poised for strong growth by FY'30, driven by supportive government policies, providing a solid foundation for these capacity expansions.

The building construction sector, the largest demand driver, is expected to expand at a robust compound annual growth rate (CAGR) of 17%, according to the government's vision document for the copper segment. The growth will be led by initiatives such as Pradhan Mantri Awas Yojana and Smart Cities Mission, along with increased foreign direct investment (FDI) and a focus on sustainable buildings.

The infrastructure and industrial sectors are projected to grow at 12% CAGR, fueled by a manufacturing push under Make in India and Atmanirbhar Bharat, alongside rising demand for machinery and capital goods.

The transportation sector is likely to see the fastest CAGR of around 18%, primarily driven by EV adoption under schemes such as National Electric Mobility Mission Plan and localization efforts.

Meanwhile, the consumer durables sector is expected to grow at a steady 6% CAGR, supported by increasing disposable income, organized retail expansion, and policy support for domestic manufacturing and energy efficiency.

Overall, these sectors collectively indicate strong economic momentum and are set to significantly boost material demand, especially for metals such as copper, by FY'30.

Structural constraints continue to drive import dependence

India's reliance on refined copper imports remained elevated in FY'26 despite the increase in domestic production. Imports stood at around 0.51 mnt in FY'26, compared to approximately 0.52 mnt in FY'25, reflecting a marginal decline of about 2% y-o-y.

Despite ongoing capacity additions, India remains heavily dependent on imports, particularly for copper concentrate. With Hindustan Copper Limited being the only domestic miner and contributing a very limited share, domestic mining accounts for only about 4% of total copper requirements, while nearly 96% is met through imports. This structural dependence exposes the industry to global supply risks, price volatility, and fluctuations in treatment and refining charges.

 

Outlook

Looking ahead, based on an expected CAGR of around 9% over the next five years, BigMint projects that India's primary copper production in FY'27 will reach around 0.77-0.78 mnt. While this reflects steady growth, it still remains slightly below the FY'18 peak of 0.84 mnt, before the closure of the Tuticorin plant.

In terms of timeline, assuming continued capacity expansion and stable operating conditions, India is likely to surpass FY'18 production levels by FY'28 or FY'29.

From a longer-term perspective, about 1.5-1.75 mnt of additional refining capacity is expected to be added by FY'30 from FY'23 levels, led largely by Adani's Kutch Copper facility. As a result, India's refined copper output is set to reach around 1.2 mnt by FY'30, as per BigMint's projections.

Although secondary production is projected to reach 1 mnt by FY'30, supported by policy initiatives such as the Extended Producer Responsibility (EPR), a significant supply shortfall of 0.8-1.1 mnt is likely to emerge, sustaining India's import reliance.