SHANGHAI, Jul 2 (SMM) – The price gap between copper cathode and copper scrap narrowed 358 yuan/mt to 1,055 yuan/mt over the week ended Friday June 29, suggesting less substitution function of scrap.
Prices of copper scrap dipping slower than that of copper cathode also led to the narrower spread, SMM data showed.
The average price of #1 bare bright copper stood at 45,510 yuan/mt for the week ended June 29, inching down 15 yuan/mt from a week ago amid sluggish demand as well as supply.
Copper scrap sellers were reluctant to let go cargos at lower prices, maintaining small amount of deliveries amid pessimistic outlook on copper price. Downstream consumption from copper rod producers stayed flat on the week, SMM learned.
Price of #1 refined copper, on the other hand, came in at 51,180 yuan/mt on Friday June 29, down 240 yuan/mt from a week earlier.
Separately, China's copper scrap imports in May declined 33.3% from a year ago to stand at 210,000 mt, customs data showed. This brought copper scrap imports from January to May to 950,000 mt, down 37.4% year on year.
China's stricter inspections of all US-imported scrap from May 4 accounted for the decline. Given a typical one-month shipment time from the US to China, the inspections are set to impact the country’s copper scrap imports in June as well.
Copper scrap imported from the US took up 15% of China's total imports and stood at 535,000 mt in 2017, SMM data showed.
