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.