China Copper Scrap Output Seen Peaking From 2014

WUHAN, Nov. 9 -- China's locally-produced copper scrap is expected to peak as early as 2014, a director at powerful industry body the China Nonferrous Metals Industry Association, said on Sunday.

    "Another five to six years, the collection of copper scrap domestically would enter into the peak period," Lu Jian, director of the information department of the association's recycling branch, told Reuters on the sidelines at the end of a two-day copper industry conference in Wuhan city in Hubei province.

    He did not provide a scrap production estimate for that period but for this year Lu said the production of copper scrap in China would fall from last year's 600,000-700,000 tonnes following a sharp supply fall in the first quarter, when the global financial crisis cut demand.

    "The local collection of copper scrap basically stopped in the first quarter," Lu said.

    He added that imports had also fallen mainly due to reduced overseas supply and tighter customs checks on scrap imports since May, increasing the cost of imports.

    China produces a third of its copper scrap, heavily relying on imports, which fell 33 percent on the year to near 3 million tonnes in the first nine months of the year.

    Scrap is used both by smelters as feed for the production of refined copper in China and by fabricators as feed for the production of semi-finished copper products.

    A shortage of scrap boosted imports of refined copper to record highs in the first half by China, the driver for the over 100-percent price rise on the London Metal Exchange MCU3 this year.

    A quarter of China's semi-finished copper products is made from copper scrap and a third of the country's refined copper production is made from scrap, Lu told the copper conference.

    China produced 1.2 million tonnes of recycled copper in the first nine months of the year of which only a third came from locally collected scrap, he said.

    That recycled copper output reflects a near 16 percent fall in monthly production on average this year. The output was 1.9 million tonnes in 2008.

    (Source: Reuters)