(Reuters) – China’s largest private copper producer Nanfang Nonferrous is due to bring a major new smelter to production by October, more than doubling its capacity, a few months ahead of expectations, four sources with direct knowledge of the matter told Reuters.

Used for wiring in electric vehicles, copper is a key plank of the energy transition. Chinese firms have ambitious plans to dominate production of the refined metal also used in the power and construction industries.

Nanfang’s new copper plant which will take its total copper production capacity to 700,000 metric tons a year from 300,000 tons suggests China’s goal of supply-side reforms to make the country self-sufficient is achievable, the sources said.

The 700,000 tons of enhanced capacity will amount to about 6% of refined copper output in China, expected to produce more than 50% of global supplies estimated at around 25 million tons.

China’s central bank earlier in August outlined measures to guide more financial resources to the private sector to help revive economic activity and growth.

Nanfang Nonferrous did not respond to a Reuters request for comment by email, telephone or WeChat.

The 400,000 metric ton-per-year smelter, located in Chongzuo city of Guangxi prefecture, will start processing copper concentrates within three months – compared with market expectations for the first half of 2024.

Concerns had previously been cited over limited liquidity available to private firms.

“It came as a surprise,” one major copper concentrates supplier said, adding that Nanfang had been buying more raw copper materials on the spot market over the past two weeks.

Purchasing copper concentrates requires access to liquidity and cash, particularly given relatively high copper prices around $8,400 a metric ton.

Copper prices are down from the record highs hit last year, but they are still nearly double the levels they fell to in March 2020 when COVID lockdowns hit manufacturing activity and industrial metals demand.

Private firms in China have struggled to access credit compared with state-owned peers, leaving capital-intensive copper smelters largely controlled by local governments.

Tight credit left Nanfang as the only privately owned sizeable Chinese copper producer.

“It is easier to finance copper projects, credit lines are sufficient to kick-start the second smelting line. Copper project has been prioritised over zinc and lead production,” one of the sources said.

Other expansion projects include Tongling Nonferrous, aiming to be the world’s top copper maker with new projects that will take its capacity to 2 million metric tons by 2025.

Rising domestic copper smelting capacity in China will mean growing demand for copper concentrates and less appetite for buying refined copper from foreign companies.