By Paul Ploumis
SEATTLE (Scrap Monster): The Bureau of International Recycling (BIR) has announced the publication of its latest edition of Non-Ferrous Metals World Mirror.
The secondary non-ferrous market remained almost silent, following the Indian government’s decision to demonetize currency notes of higher denominations. The unexpected withdrawal of high value currency impacted the trade as huge proportion of market operators usually deal in cash. The trade reported sharp drop in activity during the months of November and December, with the number of transaction hitting an all-time low. Meantime, recent reports from the country suggest that businesses are returning to normalcy and that the trade activity should pick up significantly during the coming months.
In China, new regulations by government authorities tend to have resulted in a series of permanent as well As temporary shutdown of smelter facilities. The country’s biggest zinc smelter by output, Zhuzhou Smelter Group Company Ltd has announced that it will reduce its zinc output by 5,000 metric tons during the month of January. As per rough estimates, nearly half-a-million tons of zinc concentrate output were cut in 2015 on environmental concerns. The shutdown process continued in 2016 as well. For instance, the “Green Fujian” initiative by the Fujian provincial administration has resulted in closure of wide range of smelters and mines in the province. Meantime, the closure of key mines such as Century and Lisheen, coupled with production cuts from other mines has led to sudden surge in zinc concentrate prices.
The data for the first eleven months of 2016 indicate that Chinese aluminum scrap imports declined by nearly 10% when matched with the corresponding period in 2015. However, the Nov ’16 imports surged higher by 28% over the year, said official data released by Chinese Customs Department.
In Mexico, domestic scrap aluminum demand is seen improving, but not adequate enough to block shipments out of the country. The trade seems to be impacted by factors including falling local currency and extended payment terms. According to trade participants, the VAT distortion in scrap prices is expected to diminish further in 2017.
The US aluminum remained healthy. The Midwest scrap aluminum premium advanced to US$ 0.0875-0.09 per lb when compared with the lows of US$ 0.055-0.06 per lb recorded during September. The secondary aluminum scrap prices too have improved when matched with the prior month.
Japan registered 14% year-on-year jump in aluminum scrap exports during the initial eleven months of 2016. The exports totaled 157,200 tons during this period. The aluminum scrap supply continues to remain tight in Japan, which in turn may lead to bullish market conditions throughout winter. Meantime, Japan’s exports of UBC scrap to South Korea surged higher by 56% during Jan-Nov ’16 to total 54,500 tons.
The majority of non-ferrous metal markets including copper, aluminum and zinc have reached a level of saturation, mainly on account of high prices towards end-2016. Many scrap dealers in France have reported more than adequate stock levels. Reports indicate that most of the European copper factories have sufficient stocks, thus preventing them from new purchases. The scrap supply from Germany too has tightened.
