[Cu] Forecast of Scrap Copper Market in May

SHANGHAI, May 6 (CBI China) -- Copper price failed to rebound after May Day holiday, but continued to maintain fluctuating trend, dampening the confidence of scrap copper holders and creating interests of these holders in moving goods.

    A purchase director in a medium-size copper processing producers said: “we had high sentiment in buying goods in early this year, while the cargo-holders were reluctant to sell. However, many suppliers were willing to move cargos this week, an indication of supply increases in the market.”

    A scrap copper importer said: “the new arrivals of scrap copper increased recently, although down on a yearly basis, up significantly on a monthly basis, especially compared to the early this year. Most of traders were pessimistic about the price outlook and were willing to sell goods at current price due to limited upward room for the copper price and the increasing supply, helping the buyers be in a stronger position in the market.”

    CBI believes the increasing imports helped ease the tightness of scrap copper supply, and the previous inventories began flowing into the market, leading to supply surplus in the market. More production cuts for maintenances will appear at smelters during May, leading to declines in raw materials demand; scrap copper rod producers focused on consuming the existing raw material inventories and adopted a cautious attitude toward to purchase. In this context, weak demand and oversupply will remain in scrap copper market during May.

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