SMM3 29 July news:
I. Policy review:
Since January 1, 2019, the import of "seven types" of scrap copper has been completely banned. At present, imported scrap copper contains only "six types" of scrap copper, that is, all kinds of copper scrap. According to ten customs statistics, from January to February 2019, the cumulative amount of imported scrap copper decreased by about 27% compared with the same period last year, but the cumulative amount of imported scrap copper increased by about 11% compared with the same period last year. Therefore, taking into account the performance of the first two months of this year, there has been no reduction in the amount of scrap copper imported at present.
With effect from July 1, 2019, the "six types" of copper scrap will be changed from unrestricted import solid waste to restricted import solid waste, and only processing waste enterprises with import approval and enterprises in the recycling park can be imported. It is understood that at present, some enterprises have declared, but no enterprises have been approved.
In accordance with the objectives set out in the implementation plan of the "ban on the entry of foreign waste", "the import of solid waste that can be replaced by domestic resources will be phased out by the end of 2019". By 2020, the "scrapped six categories" may also face a total ban. While the import of solid waste is completely prohibited, some of the "waste six categories" may be imported separately as resources, and the specific classification criteria are still under discussion.
II. Policy trend projections:
According to the current policy trend guess, in the first half of 2019, "six types" of scrap copper as unrestricted normal imports; In the second half of the year, while the "six categories" of scrap copper were converted to restricted categories, the state announced the specific standards for the conversion of solid waste to resources, formally stopped the import of solid waste from 2020, and began to implement the resource import program at the same time. Scrap copper, which is not classified as a resource, will be banned from import. At that time, "scrap copper" will no longer exist, only "copper renewable resources".
III. Analysis of types and flow directions of imported scrap copper:
According to the above guess, in order to infer the supply of imported scrap copper in the second half of the year, the resource classification standard has become a very key issue. On the basis of this, according to the ten customs data of copper scrap from January to February 2019, SMM combed the types, grade and proportion of "six types" of copper scrap.
From the proportion point of view, the import of "six types" waste copper is mainly No. 2 waste red copper and waste yellow miscellaneous copper, the proportion of metal content is 46.5% and 30.9% respectively, and the proportion of No. 1 waste copper metal is about 12.0%. The total proportion of the three is nearly 90%. Is the main source of imported scrap copper, the rest also includes a small amount of waste purple copper, bright copper, PCB circuit boards and other copper scrap.
From the point of view of grade, the grade of imported scrap copper can be divided into three grades, the first grade is good scrap copper with copper grade of more than 94%, including bright copper, No. 1 scrap copper, No. 2 scrap copper, waste purple miscellaneous copper, the proportion of metal is about 65.3%. The second grade is mainly waste brass, the average copper grade is about 65%, accounting for about 30.9% of the total metal content, and the lowest grade is PCB circuit board, the average grade is only 15%, the proportion is also very small.
From the point of view of the flow direction, about 70% of the imported scrap copper flows to the smelting end, mainly for the first grade of scrap copper, with a copper grade of more than 94%. In addition, the copper content of PCB board is only about 15%, which can be recycled as hazardous waste by smelter with hazardous waste treatment qualification. The remaining 30% of the imported scrap copper mainly goes to the brass rod processing plant, including scrap brass with a copper grade of about 65% and all kinds of copper alloys. The copper scrap rod factory mostly uses bright copper with a grade of more than 99%, and this part of copper accounts for only 2.7% of the imported scrap copper. therefore, the scrap copper rod factory mainly depends on the domestic scrap copper supply, and the imported scrap copper supply has little effect on it.
IV. Classification criteria (forecast) and supply analysis of solid waste conversion resources:
According to the grade of copper scrap is the most direct way. Then the most likely grade standard is 94%, that is, the first scrap copper is allowed to be imported, including bright copper, No. 1 scrap copper, No. 2 scrap copper, scrap copper. The scrap copper used at the smelting end will not be affected, and the scrap brass raw materials used in the copper rod processing plant will be cut off, prompting it to change the use structure of the raw materials: from using waste brass to using copper ingots produced by scrap copper or directly using electrolytic copper combined with zinc raw materials, The production cost of brass rod enterprises has risen, and the import of copper scrap has been reduced. If 30 per cent of scrap brass is banned, imports of copper scrap metal are estimated to be reduced by about 400000 tons based on 2018 imports. According to the current recovery rate of about 60% of domestic scrap copper, the increment of domestic scrap copper can not make up for this gap. Some of the scrap copper raw materials will be replaced by copper ingots and some will be replaced by refined copper.
According to the use of copper scrap, high probability scrap copper will also be allowed to import, excluded only PCB circuit board, more than 96% of the six types of scrap copper will not be affected. According to this way of classification, the significance of dividing six types of scrap copper into resource categories will not be reflected, and it is unlikely to be implemented.
As a result, SMM believes that from 2020, scrap copper with a copper grade of more than 94 per cent will be imported normally as a resource category, and the import of the remaining "six types" of solid waste will be banned, because 30 per cent of the scrap brass will be banned. It will cause a gap of 400000 tons of scrap copper raw materials, which will provide a significant boost to the consumption of refined copper.
In the first half of 2019, as a normal import of unrestricted copper, the amount of imported metals may increase instead of decreasing because of the effect of rising grade and partial grabbing of imports. In the second half of the year, the "six types" of copper scrap will be implemented. At the same time, the state will publish the classification standard of solid waste conversion resources, which will promote enterprises to gradually change their waste habits and prepare for a formal ban on solid waste imports in 2020. It is expected that the amount of copper scrap metal imports will decrease slightly in the second half of the year, which will mainly affect the small-scale waste enterprises, and the total import volume will not be affected much in the whole year.
(SMM Wei Xue)