Page 21 from: August 2015
21August 2015
shredder residue (ASR) processing facilities are
capable of handling 600 000 tonnes per year of
metallic materials which were historically land-
filled, like insulated copper wire.’
Additionally, EMR’s renewable energy facility
produces synthetic gas from the remaining
material that is considered ‘not eligible for recy-
cling’. Labelled SynGas, this can be used in
exactly the same way as natural gas would be
used in a conventional power station. ‘A benefit
of gasification is that it leaves the small fraction
of metals that were still present in the ASR fuel
intact and in a form that can be easily recycled,’
Bayram explained.
Margins ‘severely squeezed’
China’s scrap imports dropped to a six-year low
in the first quarter of 2015. Commodities con-
sultant and analyst Daniel Smith observed that
copper prices, meanwhile, had been drifting
steadily lower after starting to underperform
back in 2013 in comparison to other base met-
als such as aluminium, nickel and zinc. He won-
dered: ‘Has sentiment around copper changed?’
Smith noted that the US dollar had been strong-
er in the short term. ‘This will likely continue for
about a year – but at the same time, be aware the
value is close to a turning point,’ he said. ‘It will
revert circa 2016.’ The five-year outlook for the
US dollar was ‘not that optimistic’, he suggested.
C O P P E R
Copper was expected to trade around ‘the low
US$ 5000 dollar mark’ for the next six months.
Smith warned that copper costs were ‘pretty
dramatic’ and margins for the main producers
had been ‘severely squeezed’.
A ‘small victory’
Treatment charges might have been high in
2014 but had fallen 15% in the year to date
owing to ‘disappointing’ mine supply. Smith
Developments in China
China’s copper metal output was 17.8 million
tonnes in 2014, which was 19% more than in the
previous year. ‘The volume of scrap copper reached
2.95 million tonnes, resulting in a 7.3% increase
over 2013,’ said Sherry Wang, a representative of
the China National Resources Recycling Association.
She told delegates in Barcelona that roughly a
third of Chinese domestic copper consumption
was met through scrap copper recycling. ‘China
imported 4 million tonnes of scrap copper (last
year),’ Wang stated. ‘And the good news is that,
by the end of 2015, secondary copper output will
cover about 40% of total copper output.’ With the
increased level of civic consumption and the high
pace of product renewal, domestic scrap recy-
cling’s share was expected to increase.
Meanwhile, Wang estimated that a third of copper
concentrates at Chinese refineries was scrap
imported from overseas – and mainly from the
USA, Germany, Japan and Russia. Imported and
local blister copper covered 10% of the total raw
materials. ‘Shandong, Yunnan, Hunan and Hebei
are emerging as blister copper supplier areas,’ she
explained. ‘Sadly, small enterprises have now
stopped production altogether and some even
face closing because of order reductions.’
And yet the state was diligently working on poli-
cies – such as the Silk Road Economic Belt initiative
– to encourage international trade as well as a
‘powerful’ domestic economy in light of the slow-
down in overall growth. Wang stressed that offi-
cials were ‘especially supporting’ imports of cop-
per scrap and concentrates. www.crra.com.cn China ‘supports’ imports of copper scrap.
also contended that China’s State Reserves
Bureau would buy copper on price dips and
that exchange inventories remained relatively
low. Bearing in mind the largest mine produc-
ers are in Chile, China, Peru and Zambia, he
noted that the copper currency divergence was
down around 8% compared to a year earlier.
Both LME and Shanghai stocks were building –
‘suggesting that the market is oversupplied’,
according to Smith. And he added that Europe’s
steadily-rising recycling rates had been ‘more than
offset’ by a decline in Asia. Another risk factor was
the fate of Greece and its mountain of debt.
‘So is there light at the end of the tunnel?’ Smith
pondered. He described as a ‘small victory’ the
fact that prices could have fallen by 10% more
as in similar scenarios over the past couple of
years. ‘Still, for now I’d say it could be a pretty
rocky year and advise you all to be quite cau-
tious,’ he concluded.
Law, interrupted
Speakers at the Barcelona conference generally
agreed that ideas sounding perfect in theory
were very hard to realise in practice. This was
especially true, it was suggested, for agen-
da-topping then suddenly ‘frozen’ eco-concepts
emanating from Brussels. ‘It’s a peculiar situa-
tion when even the authorities in my network
are still trying to figure out what the renewed
circular economy package will mean exactly,’
EMR’s Bayram stated.
To the surprise of no-one, changes to India’s
pre-shipment inspection procedures were
Recyclers should not rely on producers to ‘hand over’ all the material to them.
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