Still buying
Rumors circulate and doubts stir regarding nonferrous metals pricing, but overall demand seems to remain strong enough to keep prices aloft into the spring.
While some buyers may have hoped the Chinese New Year holiday would bring price increases to a halt, strong buying patterns have remained in place for copper, aluminum and other metals.
The latest news that could affect market fundaments is a looming tightening of scrap import regulations by the Chinese government. According to the Metallurgical Council of China, businesses exporting scrap to China will have to be registered with the federal government in Beijing by July 1 and receive subsequent approval by the government to continue shipping to Chinese ports.
The Council’s Meng Jianbin told the New York Times that the Chinese government is scrutinizing the scrap industry for its environmental practices. “Scrap processors are using very old ways to do the scrapping, which is very harmful to the environment,” the Council officer told the Times.
Bureau of International Recycling (BIR) Director General Frances Veys remarked to the Times that the BIR would welcome such controls if they helped crack down on unscrupulous operators who have harmed the reputation of the industry by shipping loads that are closer to trash than to being a secondary commodity.
As spring gets underway, any effects of such regulations seem far away. Nonferrous recyclers are having no difficult moving material at market prices. One recycler calls the last several months “fun, for a change.”
The higher pricing has not only provided a profitable trading margin, it has also brought in additional scrap in some cases. “Material is coming in from the wood work,” says one copper and aluminum recycler, who notes that contractors and small dealers who may have been holding onto copper for just such an occasion are cashing in on the higher scale prices.
One international broker warns, though, that if Chinese consumers have been building up their inventories in anticipation of the import-export restrictions, this could cause a fairly sudden downward jolt in scrap demand.
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(Additional news about nonferrous metals and scrap, including breaking news and consuming industry reports, is available online at www.Recycling Today.com.)
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COPYRIGHT 2004 Gale Group
