Price: Limited copper scrap price gains widen refined-scrap price spread
China's refined copper prices increased last week, while copper scrap prices followed the rise but the gains were limited due to sluggish spot market trading, widening the refined-scrap copper price spread.
Looking ahead, refined copper prices are expected to trade mostly range-bound in the near term. Copper scrap prices, weighed down by weak supply and demand, are likely to be less resilient than refined copper, keeping the refined-scrap price spread elevated in the short run.
Data Source: Mysteel
Supply: China copper scrap supply shifts on price swings
China's copper scrap supply eased before tightening last week. As copper prices surged and then pulled back, market activity cooled. Early last week's price rise improved trade sentiment, with most holders sitting on profitable inventories choosing to sell into strength. This gradually released backlogged copper scrap and improved spot availability. Later, as prices fell and downstream and end-user demand remained weak, circulating supply tightened noticeably.
Looking ahead, spot supply may see some improvement when prices are high in the short term, but the overall tightness is expected to persist.
Demand: Policy headwinds and demand off-season limit copper scrap buying
China's copper scrap market saw relatively limited spot trading last week. For red copper scrap, downstream buying interest was weak, with most purchasing only on an as-needed basis. Some processors were also in production suspension due to policy impacts or switched to tax-inclusive copper scrap, which dampened trading volumes. For brass scrap, persistently sluggish end-user demand and high prices suppressed downstream buying, leaving downstream orders weak and providing little support for raw material demand. Additionally, enterprises in some regions faced constraints from invoice-related factors, limiting their feedstock purchases. Overall market demand was insufficient.
Looking ahead, downstream consumption is unlikely to improve significantly in the near term. For copper anode producers using scrap, elevated copper scrap prices and tight availability are still expected to curb their copper scrap purchasing needs. As for secondary copper processors, weak order inflow from end-users during the off-season is likely to continue weighing on their copper scrap procurement.
More regular analysis and comprehensive data on China's copper industry are available in Mysteel Copper Weekly, Mysteel Copper Monthly, and Mysteel Copper Database. Reach out to us via Mysteel's official website: Latest & Reliable Copper Market Price in China | Mysteel, and follow Mysteel Non-Ferrous for more insights!
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Written by Zhaorui Cui, cuizhaorui@mysteel.com
Edited by Mingyuan Wang, wangmingyuan@mysteel.com
