Zijin Mining Expands Beyond Gold as Copper Gains Strategic Importance

Zijin Mining is emerging as a dominant force in China's critical minerals sector, with gold and copper operations now accounting for 89% of total revenue as surging metal prices and geopolitical demand reshape the company's growth trajectory.

The Xiamen-based miner has significantly outpaced China's gold reserve base, holding copper reserves of 50.43 million tonnes—equivalent to 124% of China's total reserves—and 1,487 tonnes of gold, representing 46% of national reserves. The company's expanding mineral portfolio positions it to capitalize on rising demand from power grids, artificial intelligence infrastructure, and electric vehicles, sectors expected to drive copper consumption up 60% by 2030, according to Goldman Sachs projections.

In the first half of 2025, gold operations generated RMB 95.9 billion ($13.2 billion) in revenue with a 62.2% gross margin, while copper operations contributed RMB 53.3 billion with margins reaching 60.9% for mined copper. The company's reserves continue to expand faster than extraction rates, with new copper resources of 2.05 million tonnes added in H1 2025, exceeding production of 439,000 tonnes.

As of October 15, Zijin's shares had risen 109.48% year-to-date, though its price-to-earnings ratio of 17.7 times remained the lowest among major Chinese gold miners, reflecting market uncertainty over copper price direction that analysts say is now clearing.

Gold Operations Drive Revenue Growth

Zijin's gold business has become the primary revenue driver, contributing more than 100% of total revenue growth in the first half of 2025. Gold operations generated RMB 95.9 billion in revenue, up RMB 20.9 billion from the same period in 2024, while total revenue increased by RMB 17.3 billion to RMB 167.7 billion.

The company operates a dual-source gold business comprising mined gold and smelted gold from purchased raw materials. Mined gold sales have steadily increased their share, rising from 14.4% of total gold volume in 2021 to 28.2% in H1 2025. This strategic shift has come at the cost of overall volume, with total gold sales declining from 319 tonnes in 2022 to 296 tonnes in 2024.

The distinction matters significantly for profitability. In H1 2025, mined gold achieved a gross margin of 62.2% with costs of RMB 262 per gram against selling prices of RMB 692 per gram. Smelted gold, by contrast, generated margins of just 0.84%, selling at RMB 713 per gram against costs of RMB 707 per gram. In 2024, mined gold sales of RMB 35.3 billion contributed RMB 19.7 billion in gross profit, while smelted gold sales of RMB 125.5 billion—representing 41.3% of total revenue—contributed only RMB 560 million.

Valuation Gap With Gold Peers

Comparing Zijin's gold operations with Shandong Gold Mining highlights a potential valuation opportunity. Shandong Gold, with a market capitalization of RMB 190 billion and a price-to-earnings ratio of approximately 34 times, operates a business model closely aligned with Zijin's gold segment.

In 2024, Zijin's mined gold sales reached 67.8 tonnes, compared with Shandong Gold's self-mined production of 45.2 tonnes—equivalent to 66.7% of Zijin's output. Shandong Gold's gross profit of RMB 11.8 billion represented 60% of Zijin's gold segment profitability. Based on Shandong Gold's valuation multiples, Zijin's gold operations as a standalone entity could command a market value exceeding RMB 300 billion.

Like Zijin, Shandong Gold derives virtually all its gross profit from self-mined gold, which contributed 95% of total gross profit in 2024. The companies diverged after 2021, when safety inspections following a mining accident curtailed Shandong Gold's production, allowing Zijin to establish a sustained lead in mined gold output.

Copper Operations Show Premium Margins

Zijin's copper business demonstrates greater balance between mined and smelted operations than its gold segment, with mined copper accounting for 53.5% of volume and 51.1% of revenue in H1 2025. Mined copper sales reached 439,000 tonnes, generating RMB 27.3 billion in revenue, while smelted copper contributed 382,000 tonnes and RMB 26.1 billion.

Mined copper delivers profitability matching or exceeding gold operations. In H1 2025, mined copper sold at RMB 62,100 per tonne against costs of RMB 24,300 per tonne, achieving a 60.9% gross margin. Smelted copper margins compressed to 1.1%, with selling prices of RMB 68,300 per tonne barely exceeding costs of RMB 67,600 per tonne.

For full-year 2024, mined copper operations generated RMB 48.2 billion in revenue with RMB 29.3 billion in gross profit, delivering a 60.8% margin. Smelted copper contributed RMB 49.4 billion in revenue but only 12% gross margin.

The competitive advantage becomes clear when compared with Jiangxi Copper, China's largest integrated copper producer. In H1 2025, Jiangxi Copper reported revenue of RMB 520.9 billion but gross profit of only RMB 18.4 billion, a 3.5% margin. Its core cathode copper business, representing approximately 50% of revenue, achieved just 3.8% gross margins. Zijin's total copper operations—including both mined and smelted—delivered 31% gross margins in 2024, reflecting substantially greater exposure to copper price appreciation rather than processing fees.

Resource Base Expands Above Extraction Rates

Zijin's reserve position extends well beyond copper and gold. The company holds lithium oxide equivalent reserves of 8.6 million tonnes, representing 55% of China's total reserves, and molybdenum reserves of 2.37 million tonnes, equivalent to 30% of national reserves, according to the China Mineral Resources Report 2024 published by the Ministry of Natural Resources.

Critically, the company continues to add reserves faster than it depletes them through production. In H1 2025, Zijin mined 38.2 tonnes of gold but added 88.8 tonnes of gold resources, including 34.5 tonnes of proven reserves. Similarly, copper production of 439,000 tonnes was offset by new copper resources of 2.05 million tonnes, including 1.32 million tonnes of proven reserves.

This expanding resource base provides long-term visibility into production growth across metals seeing structural demand increases. High-voltage transmission projects consume 20,000 tonnes of copper per thousand kilometers, while Nvidia's GB200 series cabinets require 200 kilograms of copper each and pure electric vehicles use 80-120 kilograms per unit. DC fast-charging stations require 60 kilograms of copper per unit. Goldman Sachs estimates grid upgrades alone will drive global copper demand growth equivalent to adding one United States worth of consumption by 2030.