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    Grasberg smelter halt and aluminium surge: market stress lens for mine planners

    August 12, 2026|

    Reviewed by Joe Ashwell

    Grasberg smelter halt and aluminium surge: market stress lens for mine planners

    First reported on MINING.com

    30 Second Briefing

    Copper prices again approached record territory, with Comex September touching $6.7005/lb ($14,772/t) and LME three‑month holding around $14,195.50/t, as the Gresik smelter in Indonesia halted after an 8 August boiler leak, tightening supply from Grasberg while LME copper stocks slid to 218,300 t and cash premiums widened to $138/t. Aluminium gained up to 1.9% to $3,373/t after Norsk Hydro’s 6.3 Mt/y Alunorte alumina refinery cut output by half on Brazilian gas disruptions, against already low LME aluminium inventories of about 255,000 t amid Iran war‑related Middle East supply risks.

    Technical Brief

    • Gresik smelter shutdown follows an 8 August boiler leak, with repairs and assessment taking “weeks”.
    • PT Smelting, owned by Mitsubishi Materials and PT Freeport Indonesia, operates Gresik to process Grasberg ore.
    • Freeport’s Manyar smelter in East Java is scheduled to resume in September, partially offsetting Gresik’s outage.
    • Grasberg mine is still recovering from a fatal mudslide, with full output only targeted end‑2027.
    • LME copper cash–three‑month spread widened to a $138/t backwardation, signalling acute prompt‑metal tightness.

    Our Take

    Mitsubishi Materials appears in our database both as a shareholder in PT Smelting and as an active player in low‑carbon copper and critical minerals supply chains, including GHG‑traced Escondida copper cables and rare earth refining, signalling that disruptions at the Gresik smelter could ripple into several of its downstream decarbonisation initiatives.

    Freeport-McMoRan’s exposure to Grasberg and the Gresik/Manyar smelter complex comes after it recently joined the small group of miners above $100 billion market capitalisation in our coverage, so any prolonged Indonesian processing bottleneck is likely to be closely watched by large-cap investors already pricing in strong copper growth to 2027 and beyond.

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    Prepared by collating external sources, AI-assisted tools, and Geomechanics.io’s proprietary mining database, then reviewed for technical accuracy & edited by our geotechnical team.

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