Copper scrap supply tightness intensified last week due to sellers holding onto their cargoes amid plunging copper prices and pre-holiday stockpiling by some copper rod plants that planned to maintain production during Labour Day holidays.
The price spread between copper cathode and copper scrap continued to narrow from 1,874 yuan/mt two Fridays ago to 1,168 yuan/mt last Friday, and even narrowed to 675 yuan/mt in the middle of the week. The price spread was disadvantageous for copper scrap users, dampening consumption. RCs of blister copper remained unchanged from April 21.
The supply tightness of copper scrap will not affect blister copper and copper anode production any time soon. But if the supply tightness remains, RCs of blister copper should fall in two weeks. With the gradual recovery of terminal real estate, the demand for civil wire and cable is picking up. And new orders for copper rods produced with copper scrap stabilised, and this will grow copper scrap used in processing plants.