Copper Scrap Market Stuck in High-Level Stalemate Amid Invoice Constraints

In August 2026, the copper scrap market faced extreme price differences between primary metal and scrap, reaching a historical high of above 5,000 yuan/mt. The price difference between copper cathode rod and secondary copper rod also fluctuated at highs in the 1,150-2,260 yuan/mt range.

The substitution advantage of copper scrap over copper cathode reached an unprecedented level, but spot copper scrap transactions failed to pick up volume throughout the month, exhibiting a distorted pattern of 'high spreads, low transaction volumes, and strong invoice constraints.'

The underlying constraint in the copper scrap market remains the combined impact of the reverse invoicing policy and the scarcity of tax-inclusive invoices. Tax-inclusive invoice tax rates for secondary copper raw materials across regions have climbed from 10.5% to 11.5%-12%, with Guangdong reaching 12%. Domestic tax-inclusive copper scrap supply is scarce, and enterprises competing for input invoices have kept compliant supply tight.

As a result, tax-exclusive copper scrap prices consistently lagged copper cathode gains. Suppliers' selling pace amid wild swings in copper prices showed a typical pattern of 'selling into rallies and holding back from selling on dips.'