SHANGHAI, Jun. 26 (SMM) – China's scrap copper imports fell 5.14% on the month in May to 303,200 tonnes, Customs data indicate, but SMM expects an increase later.
Scrap copper imports posted a 16,400-tonne decline during May, down from April’s 319,600 tonnes China Customs report. The volume was also 16.31% lower than May 2013. Through the first five months, China imported 1.496 million tonnes of scrap copper, falling 13.44% year-on-year.
Scrap copper imports recorded in May were mostly ordered in March when Chinese importers showed little interest in scrap imports given the low SHFE/LME copper price ratio.
Meanwhile, as the price gap between scrap and refined copper fell below 1,000 yuan per tonne in March, processors were less willing to use scrap copper as raw material, which also resulted in fewer arrivals in May.
SMM believes the wider price gap between scrap and refined copper in April and May, as well as June's copper price rebound in China will boost selling interest among Chinese scrap traders. That, combined with tight scrap copper supply in China's domestic markets, promises to allow China's scrap copper imports to grow.