[SMM Analysis] there are few scrap copper approval documents left in the fourth quarter, the import of scrap copper is worrying.

SMM, 4 Dec:

On December 3, 2019, the 15th batch of restricted waste import approval was announced, involving 7970 tons of copper scrap, and the amount of approval continued to decrease month-on-month.

Up to now, a total of 560700 physical tons of scrap copper have been approved in the first seven batches of scrap copper approval documents in the second half of 2019, which is about 449000 metal tons according to the average grade of 80%.

The 15th batch of scrap copper approval is expected to be the last batch of scrap copper import approval in 2019, and the 2020 approval will be issued by the end of December. If the import is strictly in accordance with the approved quantity, the total amount of copper scrap imported in the second half of the year will be controlled within the 560700 physical tons involved in the approval.

According to the eight customs code copper import data released by the General Administration of Customs, from July to October 2019, China imported a total of 468100 tons of scrap copper. At present, only 92600 tons of scrap copper have yet to be used. Waste copper imports will continue to decline significantly in November and December. The actual volume of scrap copper imports in October was only 97000 tons, down more than 40 percent from the previous month.

According to SMM, starting from about the middle and late October, the approval documents in the hands of enterprises have almost been used up, scrap copper is difficult to import, and the import of scrap copper trade is very light, which has also led to the continuous expansion of import scrap copper deduction. Only the scrap copper ordered in the fourth quarter has been shipped to Hong Kong one after another. At present, a small number of enterprises have begun to order goods to Hong Kong in February next year.

The issuance of approval documents next year is still not optimistic, but as the policy of free import of copper scrap to resources will begin to be implemented in the second quarter of next year, the actual import volume of scrap copper next year is more uncertain.

(SMM Wei Xue)