What’s Impact on Scrap Copper Rod Producers in Henan after Environmental Protection Inspections? SMM Reports

SHANGHAI, Dec. 23 (SMM) – Henan’s provincial government held an emergency response meeting on December’s 19 night after severe haze recently, and would take 72-hour centralized and uniform actions against heavy air pollution from December 20-22 across the region.

Most scrap copper rod producers in Henan are small ones, and SMM survey finds that all local producers of the type, with no environmental license, have been required to shut down. Only large ones, equipped with environment-friendly facilities, remain online, and with cuts at some of production lines, according to SMM survey.  

As Tianjin previously took actions to inspect small scrap copper rod makers for environmental factor, all producers of this kind were shut down in the region. Hence, orders originally for producers in Tianjin shifted to makers in Henan, giving a strong boost to orders at scrap copper rod producers in Henan. But, the latest round of environmental efforts by Henan ceased production at most of local producers, and only a few ones, after meeting environmental requirements, are running at full capacities and could not meet demand, SMM survey shows. 

Moreover, the recent price gap between refined and scrap copper narrowed with a sharp decline in scrap copper supply in Henan and Tianjin. Copper processing enterprises in Henan began sourcing refined copper from Shandong to meet production demand after scrap copper supply fell in Henan, narrowing spot discounts in Shandong market. On December 22, spot discounts in Shandong copper market were offered at 170 yuan per tonne, up 40 yuan per tonne from December 20’s. Spot prices in Shanghai copper market also were also up as falling supply of scrap copper promoted some processors to buy refined copper instead. On December 22, spot discounts in Shanghai were offered at 135 yuan per tonne, up 80 yuan per tonne from December 20’s. 

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