Copper Scrap Prices Rise in China, but Gains Limited by Weak Demand

Copper scrap prices in China moved higher last week, but weak downstream demand kept their gains smaller than refined copper's.

The refined-scrap copper price spread widened as a result, with larger refined copper price gains leading to increased prices for copper scrap. However, the impact of the reverse invoicing policy is expected to keep domestic copper scrap supply tight in the short term, supporting higher prices.

Copper scrap import profit decreased last week due to volatile domestic and overseas copper scrap prices, ranging from -Yuan 607.65/tonne to -Yuan 33.88/tonne. Despite this, China's copper scrap import volumes are expected to remain relatively high in the near term due to strong demand.

Upstream holders were cautious before the holiday, cutting sales and adopting a quick in-and-out strategy for red copper scrap. Limited available spot red copper scrap constrained traders' shipments, while brass scrap merchants remained weak in their willingness to restock and ship due to high feedstock costs squeezing margins.