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China issued first batch of copper scrap import quotas for 2020
Dec 24,2019 15:02CST
smm insight
Source:SMM
China granted import allowances for 270,885 mt of high-grade copper scrap in the initial batch of quotas for use next year

SHANGHAI, Dec 24 (SMM) – China's environmental authorities on Monday issued the first batch of copper scrap import quotas for 2020, which is estimated to be able to satisfy needs at major scrap users in the three months to come.

The China Solid Waste and Chemicals Management Bureau, a unit of the Ministry of Ecology and Environment, granted import allowances for 270,885 mt of high-grade copper scrap in the initial batch of quotas for use next year. This is estimated to contain 217,000 mt of copper, with a Cu content of 80%, the average grade for imported volume in 2019.

The initial 2020 copper scrap import quotas were awarded to 108 companies, with nearly 95% of the total quotas allocated to firms in the major recycling hubs of Zhejiang and Guangdong.

More quotas are expected to be issued for Q1 2020, as some companies who obtained quotas in 2019 were not included in the latest batch. This indicates that Chinese copper scrap users are unlikely to be beleaguered by import quota shortages in the three months ahead, as the same period last year saw 280,000 mt of copper imported in the form of copper scrap.

For the top six companies in terms of quotas they were awarded in the initial batch for 2020, they were granted a combined allowance volume of 124,880 mt, topping the volume of 123,457 mt they imported in Q1 2019 but accounting for just 70% of the allowance volume of 177,268 mt they were awarded in the initial batch for 2019.

Tighter restrictions on copper scrap imports came into force in July 2019, before when Chinese scrap users could import the so-called Category 6, high-grade copper scrap in unlimited amounts.

Import quotas for copper scrap, however, are set to be on the decline in the future batches, as Beijing aims to cut inbound waste to zero by the end of 2020.

“Solid waste imports next year will reduce sharply from this year,” said the recycling unit of China’s nonferrous metals industry association at a metals recycling forum in November. Import allowances will continue to be issued on a quarterly basis next year, and those for Q1 will take up a relatively higher proportion of the import volume for the full year, it added.

The metals recycling unit also mentioned that the standards for secondary copper and secondary aluminium raw materials will be introduced “as soon as possible.”

China now classes scrap metal as a solid waste, and high-grade copper scrap meeting the standards, expected to come into force before Q2 2020 at the latest, will no longer be classed as waste and can be exempted from the licensed quota-based import system.

The introduction of the long-anticipated scrap “reclassification” is set to help ease raw material supply crunch and ensure production at Chinese scrap users.

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