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[SMM analysis] scrap copper goods and tickets are in short supply! The import of copper ingots has attracted much attention.
Sep 25,2020 19:15CST
The content below was translated by Tencent automatically for reference.

SMM9 March 25: according to the latest customs data, copper scrap imports in August were 81027 tons, an increase of 7.87 percent over the previous month, and imports rebounded in the second month, in line with previous expectations. The cumulative import of copper scrap from January to August was 586758 tons, still a sharp decrease of 46.21% compared with the same period last year. With regard to the expected amount of copper scrap imported in September, according to SMM, the joint and several liability of the new solid waste law just implemented this month has led shipping companies to carry solid waste cautiously, and there are no small difficulties in transporting waste copper from Europe, the United States and other regions to China, which has restrained the scrap copper market and directly led to the extension of customs inspection time for imported waste. However, the transportation problem is mainly solved by suppliers, while domestic enterprises only need to have approval documents. In September, the 12th batch of approval documents issued more than 130,000 tons, alleviating the shortage of market approval documents in a short time. Taken together, copper scrap imports may continue to pick up in September, but the volume should not be very optimistic.

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The import volume of scrap copper and the approved import volume of approval documents so far in 2000 (unit: tons)

From the same period last year, the import of scrap copper is still low, it is difficult to supplement the domestic scrap copper gap, the operating rate of superimposed scrap copper rod enterprises is at the peak level in the third quarter, and the speed of digesting scrap copper is faster. Scrap copper rod enterprises reflect that at the end of August, the domestic high-quality scrap copper began to feel significantly less, the purchase of scrap copper is more difficult, and the price is higher. In the middle of September, the scrap copper smelting and processing policy of a city in Jiangxi Province was adjusted, and some processing plants needed to reserve a certain level of safety production inventory before the National Day, which further led to the shortage of goods and tickets in the scrap copper market.

Copper ingots as an important substitute for waste copper raw materials, affected by China's goal of gradually reducing the import of solid waste, since 2018, in order to make up for the gap of copper scrap, the import volume began to rise. The gap in scrap copper is even larger this year, directly stimulating a surge in imports of copper ingots. According to customs data, copper ingot imports in August were 46224 tons, up 2 per cent from a month earlier, slowing down, but still up 161 per cent from a year earlier.

In order to solve the shortage of domestic raw materials and invoices, the waste enterprises in Jiangxi region reflect that the number of copper ingots purchased has increased recently, mainly because the supply of copper ingots will be relatively abundant and will not be restricted by import approval documents, and the imported copper ingots have also been taxed, and part of the invoice problem can also be solved. The import volume of copper ingots increased slightly in August, which may be affected by market saturation, but according to the current situation that waste enterprises take the initiative to purchase copper ingots, it is expected that imports of copper ingots will continue to show an increasing trend. However, a considerable number of waste enterprises do not like to use copper ingots as raw materials, because the grade of some copper ingots is unstable or the content of impurities is easy to exceed the standard, so copper ingots can not completely replace waste copper, some manufacturers have to continue to actively supplement waste copper raw materials.

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