China's Tight Supply of Copper Scrap to be Further Intensified by Malaysia's Import Restrictions

Published: Sep 14, 2021 11:34

Save

The Malaysian Ministry of International Trade and Industry recently announced that the temporary grace period for the tightening of metal scrap import standards, which was originally scheduled to expire on August 31, will be extended by two months to October 31.

SHANGHAI, Sep 14 (SMM) - The Malaysian Ministry of International Trade and Industry recently announced that the temporary grace period for the tightening of metal scrap import standards, which was originally scheduled to expire on August 31, will be extended by two months to October 31.

Metal content in imported copper scrap is required to be at least 94.75%, which is all but as strict as the secondary copper raw material standards in China. This means that local recycling companies in Malaysia will not be able to import Category Seven copper scrap or some low-grade Category Six copper scrap.

According to SMM statistics, Malaysia imported a combined 189,700 mt of copper scrap from January to June of 2021. After being smelted and processed, 32,800 mt of high-grade copper scrap was exported. The rest was exported in the form of copper ingots or blister copper. Most of these goods were sold to China. Therefore, Malaysia is expected to become a pure global copper scrap transit trading centre after the new standards for copper scrap import are implemented. The country’s exports of processed copper scrap is expected to shrink. Chinese importers could hardly make up for the gap from other countries. In this scenario, overseas resources that meet China's import standards will be less and prices will be more firm, affecting China's imports of raw materials for secondary copper. The already tight supply of copper scrap in China will intensify further.

Prices of #1 bare bright copper without invoices averaged 64,390 yuan/mt last week, down 50 yuan/mt from the previous week. The average price spread between copper cathode and copper scrap shrank 349 yuan/mt to 270 yuan/mt. For copper scrap, cif quotes for #1 copper scrap were Comex December copper less $0.13-0.14/lb, and offers for birch/cliff were Comex December copper less $0.28-0.29/lb. US brass was quoted at $6,150-6,200/mt. The coefficient for #2 copper granules against LME copper was 96-96.5% on a cif basis, and the coefficient for bare bright copper against LME copper at 99-99.5%, on a cif basis.

copper scrap import

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

8 hours ago

Fed's Waller: Ready to Cut Rates if Labor Market Weakens, Cautious on Inflation Risks

US Fed Governor Christopher Waller said on Friday that if signs of weakness emerged in the labor market, he would again support an interest rate cut later this year, while remaining alert to the inflationary pressures that the current geopolitical situation may bring.Waller noted that a closure of the Strait of Hormuz signaled greater inflationary pressure, and that higher oil prices could ultimately affect core inflation. He stressed that the current cautious stance did not mean there would be no action for the rest of the year.His remarks sent an important signal to the market—that the window for an interest rate cut had not closed, provided that employment data showed clear weakening.

8 hours ago

IRGC: US Carrier Ford's Deployment and Withdrawal Reflects "Desperate and Humiliating" Reality for US, Israel

According to Xinhua News Agency, the Islamic Republic News Agency reported on the 20th that the Islamic Revolutionary Guard Corps issued a statement saying that, despite extensive attention from Western media, the US Navy aircraft carrier Ford was deployed to the West Asia region but failed to provide support for US forces there and instead withdrew from the battlefield, reflecting the “desperate and humiliating” reality facing the US and Israel.

8 hours ago

US Treasury Secretary Bessent: SPR Release Complexity and Limits Amid Oil Price Stabilization Efforts

US Treasury Secretary Bessent claimed that the Strategic Petroleum Reserve (SPR) could be tapped again to suppress oil prices, but the reality was far more complex than this statement suggested—the reserve level was already close to the statutory minimum, and physical safety constraints left extremely limited room for any further release.Last week, Bessent said that the US had participated in the largest internationally coordinated SPR release operation to date, totaling 400 million barrels, and warned that, if necessary, the US could once again unilaterally release reserves to stabilize oil prices.

8 hours ago