Adani’s Gujarat facility, one of the largest copper smelters in India, is facing production challenges as the shortage of raw materials disrupts its output.

The supply bottleneck comes amid rising global demand for copper, crucial for industries ranging from electronics to renewable energy, putting pressure on the company to secure adequate ore to meet its annual production targets.

Kutch Copper Ltd., which began processing metal in June after multiple delays, has brought in less than a 10th of the raw material required, according to reports.

In the 10 months to October, it imported about 147,000 tons of copper concentrate. Competitor Hindalco Industries Ltd. bought a little over 1 million tons during the same period, as per reports.

The smelter requires about 1.6 million tons of concentrate to function at full strength, reported earlier.

Supply for copper smelters everywhere has been hit by a wave of mine disruptions this year, including at major producers like Freeport-McMoRan Inc., Hudbay Minerals Inc., Ivanhoe Mines Ltd., and Chile’s state-owned giant Codelco. Adding to that squeeze, China’s relentless expansion of its own smelting capacity has battered profit margins and pushed some producers outside the country to cut output or shut down.

As a result, treatment and refining charges — the fees miners pay for processing — have hit a record low this year, indicating smelters are willing to accept ever-tighter margins to secure material.

For new entrants such as Kutch Copper, which plans to double annual capacity to 1 million tons in four years, tight supply means higher expenses to maintain the facility, plus an even longer ramp-up process.

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“Adani’s smelter is new and so should be more efficient than many competitors, so in the short term the smelter could ramp up at a loss.India could also introduce higher tariffs to protect its industries. That would mean accepting “short-term pain for a longer term gain.” according to reports.

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BHP Group has supplied 4,700 tons to the smelter, while other shipments came from Glencore Plc and Hudbay, customs data show.

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Kutch Copper’s slow start is a reminder of the hurdles facing India’s efforts to increase its metals self-reliance. Surging demand from infrastructure, power and construction sectors far outpaces constrained processing capacity and limited domestic ore reserves.