Non-Ferrous Metals World Mirror February 2014

Global – The following article is based on the latest Non-Ferrous Metals World Mirror produced by the BIR world recycling organisation for the benefit of its members.

There has been strong demand for non-ferrous scrap from secondary producers in India owing to poor domestic generation and low inventories at factory level. And since consumers are relying predominantly on imports, they have been helped by a more stable rupee/US dollar exchange rate over the last couple of months. Feedback from, among others, the Middle East also confirms this ‘strong’ demand from Indian buyers.

As in India, scrap generation is also an issue in many other parts of the world. In Mexico, for example, volumes arriving at scrap yards are “well below” expectations and are showing ‘no sign of improvement any time soon’. Most yards ‘have barely broken even or have operated in the red over the last three years’, it is reported. A

nd in South Africa too, reduced industry activity has trimmed arisings and pushed up prices paid to a level that ‘leaves very little margin for all the role players in the industry’. In terms of the country’s new export rules whereby scrap must first be offered to domestic consumers at a discount to international prices, these are said to be buying scrap slightly more cheaply but not in line with South Africa’s International Trade Administration Commission policy of 20%.

Aluminium scrap remains tight in Japan because of ‘aggressive’ purchasing by smelters to meet stronger demand for secondary aluminium alloy, resulting notably from a surge in car production as well as from growth in component exports. Furthermore, collections of aluminium scrap have been hindered by recent heavy snowfalls in the Kanto region of the country.

Staying with aluminium, prices in Brazil are described as ‘very high’ for the lower-Fe grades of scrap such as extrusion, EC wire and litho, extending to 160% of LME in some instances. And strong prices for aluminium alloys in the USA have buoyed the UBC market but volumes have not increased as a result.

Latest customs figures from China suggest copper scrap imports were 19% lower in January than in December last year. Furthermore, it has been confirmed that perhaps as many as 300 AQSIQ renewal applications have been rejected although, it is stressed, these decisions may not have been related to hazardous shipments.

Feedback from New Zealand indicates ‘somewhat mixed demand’ from non-ferrous scrap export markets while domestic consumers are active buyers at present, leading to improving but still-challenging conditions for local scrap businesses.

Across the other side of the world in Europe, scrap prices in Germany are said to be ‘moving within a narrow range’. Lower levels of Chinese buying interest are reported from Italy, with one expert contending that overseas shipment prices are ‘so low that the simple addition of sea freight makes them seem exorbitant’. Brass scrap buyers appear ‘disinterested’ at present, it is added. Meanwhile, a constant demand exists for copper, lead, zinc and also bronze scrap – but these grades ‘are not readily available’.

Reports from France concur on the general lack of demand for brass scrap from European consumers, with the exception of the high grades. Practically all qualities of aluminium are proving easy to sell while demand for battery lead remains ‘substantial’ even though, at current price levels, consumers are struggling to secure the tonnages required to meet their needs.

In Russia, the trading issue of the moment is VAT on imports of non-ferrous scrap which is said to be ‘killing’ business in some instances. ‘Import duties have been at zero for two years already, but VAT is the problem,’ it is maintained. The Nordic Countries, meanwhile, are reporting an improved business outlook with Finland, Sweden, Denmark and Norway expected to record higher GDP growth rates this year of, in turn, 1%, 2.4%, 1.5% and 2.5%.