SHFE–LME Ratio and the Cost of Importing
Whether metal can profitably be imported into China comes down to one comparison: the domestic tax-inclusive price against what the same tonne costs to land. The ratio everyone quotes is a shorthand for that comparison, and it has a break-even level you can compute exactly. The table below is live.
Ratios right now
Trade date 2026-10-21 · USD/CNY 6.6893. Ratio is the domestic price divided by the overseas price in dollars; break-even is what that ratio has to reach before an import pays, using the verified duty actually applied to each metal. Overseas prices are the latest LME 3-month close for copper, aluminium, lead, zinc, tin and nickel; gold and silver use COMEX, as LME does not trade them.
| Metal | Domestic ¥/t | Overseas $/t | Ratio | Break-even | Gap |
|---|---|---|---|---|---|
| CopperCu | 109,040 | 14,137LME | 7.713 | 7.559 | +0.154 |
| AluminumAl | 22,970 | 3,004LME | 7.648 | 7.559 | +0.089 |
| LeadPb | 16,120 | 1,896LME | 8.504 | 7.786 | +0.719 |
| ZincZn | 25,550 | 3,703LME | 6.900 | 7.634 | -0.735 |
| TinSn | 385,830 | 50,275LME | 7.674 | 7.786 | -0.111 |
| NickelNi | 119,800 | 16,095LME | 7.443 | 7.634 | -0.191 |
The break-even column ignores freight and port costs, so it is the floor, not the exact threshold — add those and the bar rises a little further. A negative gap does not mean nobody is importing: term contracts, financing deals and bonded premiums all run on economics this table does not see.
What a landed tonne costs
Four terms, in this order. VAT is charged on the duty-paid value, not on CIF — which is why duty and VAT compound rather than add.
| Term | Basis | ¥/t |
|---|---|---|
| CIF value | ($14,137 + $70) × 6.6893 | 95,035 |
| Import duty0% | CIF × 0% | 0 |
| Import VAT13% | (CIF + duty) × 13% | 12,355 |
| Port & carrying costs | assumed | 200 |
| Landed cost | 107,589 | |
| Domestic spot | 2026-10-21 | 109,040 |
| Import profit / loss | +1,451 |
Copper, with freight assumed at $70/t and port costs at ¥200/t. Those two are assumptions — everything else is today's data and the verified 0% duty actually applied to Refined copper cathode (HS 740311; MFN 2%).
Duties on unwrought metal
The forms actually traded on ratio arbitrage — cathode, ingot, unwrought alloy. Semis and scrap sit under different codes with different rates and, for scrap, import bans. Do not carry these figures across.
| Metal | HS6 | Form | Duty applied | MFN | VAT |
|---|---|---|---|---|---|
| Copper | 740311 | Refined copper cathode | 0% | 2% | 13% |
| Aluminium | 760110 | Unwrought aluminium, not alloyed, <99.95% Al (7601.10.90 — A00 / P1020 grade) | 0% | 5% | 13% |
| Lead | 780110 | Refined lead, unwrought | 3% | 3% | 13% |
| Zinc | 790111 | Unwrought zinc, not alloyed, ≥99.995% Zn (SHG) | 1% | 3% | 13% |
| Tin | 800110 | Tin, not alloyed, unwrought | 3% | 3% | 13% |
| Nickel | 750210 | Nickel, not alloyed, unwrought | 1% | 3% | 13% |
Where a provisional rate exists it is the rate actually applied, so that is the figure used in the formula; MFN is shown alongside. Checked against the Ministry of Finance 2026 tariff adjustment plan and the 10-digit tariff lines (as of 2026-08-23). Preferential rates under a free-trade agreement can be lower still — check the origin before assuming these apply.
Reading the ratio
The ratio is not a market view, it is an exchange rate with tax on top. Strip the formula down and the break-even is just rate × (1 + duty) × (1 + VAT) — for copper at 0% duty that is the USD/CNY rate marked up by the VAT alone. Anything above that line and the arithmetic favours importing.
Which is why the ratio moves when nothing about metal has changed. A move in the yuan shifts every metal's break-even at once, in the same direction, with no news about supply at all. Traders who watch the ratio without watching the rate behind it end up reading currency moves as metal moves.
The gap column is the honest version of "the window is open". It closes from both sides: domestic prices fall as imported metal arrives, and the LME rises as buying moves onto it.