SHANGHAI, Mar. 28 (SMM) – Market players pay close attention on replacement of copper scrap. What is status quo of copper semis, such as copper sheet/plate and strip, copper tube/pipe and copper extrusion? Let’s see what experts said on SMM 2017 Copper&Aluminum Summit on March 24.
Collections of Stories in Base Metal Market at SMM 2017 Copper&Aluminum Summit
Will copper scrap be raw material in the future?
Mao Yiwei, COO of Jiangxi Copper Corporation International Trade, indicated that copper scrap recycling should have entered peak season in China, according to a normal production period, but copper scrap output is low at present.
Why copper scrap recycling has not reached peak season yet? China’s copper scrap recycling period is longer than that at abroad due to special national conditions. For example, life cycles of automobiles, home appliances and industrial equipment are longer than those in overseas, as those products will be reused in countryside after eliminated from cities. But those products will be recycled sooner or later. Hence, copper scrap will be important raw material supply in China in the long run.
In a short term, price gap between copper scrap and copper widens recently, especially in European and US’s markets, boosting copper scrap consumption. Proportion of copper scrap consumption in copper cathode production reduces in recent years and most copper scraps are used for alloy and copper semis production.
Will copper scrap rod replace copper rod in the future?
Wang Shengfeng, Deputy Manager of Jiangsu Zhongguangrun New Material Technology, pointed out that after government announced to shift business tax to added-value tax and introduced new policies, bare bright copper scrap could be used on copper rod production directly again. According to relevant data, government has eliminated 40 continuous casting and rolling production lines or a copper rod capacity at 1.2 million tonnes conservatively in 8 years. As total copper consumption in low-voltage wire industry is 1.5 million tonnes, market shares of copper rod may reduce 30% in low-voltage wire industry. This is what I don’t want to see. Most overseas nationals have started using high-purity conductor 60 years ago, which is more safety and energy-saving. China’s copper rod capacity, produced by imported continuous casting and rolling equipment, has reached 11 million tonnes. Copper consumption in wire & cable industry, including electronic wire & cable, magnet wire and electric power, is 6 million mt. So, China’s copper rod capacity is enough for copper consumption in wire & cable industry. Producers should use high-purity copper semis to produce more safety and energy-saving copper rod and wire & cable.
Copper scrap market will meet developing chance in 2-3 years with low profits at entity factories. During this period, government should promote high-grade copper scrap and take strict inspections on National Standard goods.
How three major projects at Foshan Huahong Copper Tube develop at present?
Liu Hui, Deputy Manager of Foshan Huahong Copper Tube, pointed out that the company mainly engages in copper sheet/plate and strip, copper tube/pipe and copper extrusion and the capacities are oversupply at present. But the prospect is positive with excellent performance on copper. As government proposes to increase use of copper semis during 13th Five-Year Plan period, company will develop new markets with optimistic outlook.
Copper plate/sheet outperforms other products. With low customer concentration, suppliers have strong power in voice and can withdraw fund timely. Company is tough in copper tube/pipe market, as power in voice is weak due to high customer concentration, and capital occupation period is longer.
Why most enterprises aim at copper rod wire market rather than copper pipe/tube or sheep/plate and strip markets?
Liu Hui said that it is due largely to low technical requirements, low investment and high production value at copper rod wire producers and high technical requirements, high investment and difficult in management at copper pipe/tube or sheep/plate and strip producers.
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