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Record copper prices likely to stop briefly U.S. ditch shipments to China

China's copper scrap imports have skyrocketed due to scarcities of concentrate that is processed into refined metal used in the power and building and construction industries, but record high prices indicate U.S. shipments are likely to stop briefly.

Smelters in top copper consumer China have dealt with concentrate shortages given that last year when First Quantum lost the right to run its Cobre mine in Panama, which accounted for 1% of global mined supply in 2022.

China's copper waste and scrap imports total climbed up 25%. to 783,004 tonnes in the first 4 months of this year compared. to the very same period in 2023, according to Trade Data Screen. ( TDM).

TDM information also shows China's scrap imports from the United. States jumped 37% to 153,059 tonnes in January to April this. year from the very same period last year.

Copper scrap from the U.S. is priced at a discount to the. CME rate, which hit a record $5.1985 a pound or $11,460 a. tonne on May 20 due to parties which had sold futures being. required to purchase them back or roll over positions.

Chinese purchasers are postponing U.S. copper scrap deliveries,. a source at a Chinese trading company said, adding that China's top. scrap supplier was the United States.

The source stated some Chinese purchasers were aiming to rate. U.S. scrap versus copper on the London Metal Exchange (LME),. trading at a discount rate to CME rates.

Deteriorating production at other mines, lots of in Latin. America, has worsened concentrate lacks and Chinese. smelters have imported more copper scrap to feed their heating systems. and safeguard their margins.

China is home to half of the world's copper smelters and the. biggest purchaser of basic materials including concentrates and scrap.

Scrap usually represents about 9 million tonnes or. roughly 30% of worldwide copper supplies yearly.

Due to focus tightness copper smelters are processing. more scrap and blister, said Macquarie expert Alice Fox.

Offered the cost of physical collection and processing -. during durations of significant rate movement, scrap tonnages on. a consisted of copper basis can move by approximately one million tonnes. per annum, effectively rebalancing the market throughout durations of. high or low prices.

Macquarie expects the gap in between copper supply and need. to broaden to 1.6 million tonnes in 2030 from a deficit around. 86,000 tonnes this year.

(source: Reuters)