SHANGHAI, Feb 20 (SMM) – Transactions of copper scrap in Foshan of southern Guangdong province, which is one of China’s main metal recycling centres, will resume gradually next week as the government urges producers to recover operations. However, copper scrap recycling and dismantling may return to normal only by next month given the existing transportation curbs and quarantine requirements for migrant workers.
The Foshan copper scrap distribution centre remained shut as of February 19, due to an absence of resumption of workers, and this resulted in limited availability of copper scrap and muted trades in the market. Operations of scrap-using copper rod producers were also impacted amid disruption of raw materials supply.
Downstream scrap-consuming producers restarted work as early as February 10, but they only used cargoes purchased before the Chinese New Year holiday rather than replenishing the stocks. Most producers faced dwindling raw materials stocks, suggesting great pent-up demand.
Major copper scrap trades in Foshan said they will resume operations by February 24, and some traders took an even pessimistic prospect, expecting the return of workers by end of the month.
The Foshan government said on February 18 that businesses no longer need to seek prior approval before resuming operations and they need not require returning workers to show proof of their health.
SMM assessments indicated that prices of 1# copper in Guangdong stood at 41,300-41,500 yuan/mt as of February 19, up 500 yuan/mt from a week earlier.
