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Non-ferrous outlook: global health fears dent optimism

New Year hopes for higher prices are dashed by impact of coronavirus. Below is a teaser of our latest market analysis, which will be published in the next issue of Recycling International.

Non-ferrous metal markets are more subdued than they have been for years. Just a few weeks ago, the year had started reasonably well with many retailers feeling optimistic and traders anticipating an upward trend for prices over the course of the year. Then came the virus.

The corona virus managed in a very short time to make all forecasts and expectations meaningless. Trade with China came to a standstill in the short term. Containers were no longer processed and the largest trading partner in Asia was suddenly ‘offline’. This applies not only to scrap exports to China but, more crucially, imports of important products from China.

European industry is currently lacking thousands of small parts for its own products. Suppliers to the automotive industry have already had to announce company holidays because essential parts from China are missing. The cycle continues. Where no products are forthcoming, there is less need for metal and so less production scrap. Many retailers are at a loss and prospects are far too uncertain.

In one of many newsworthy developments, the Chinese copper smelter Guangxi Nanguo was reported to have declared force majeure on shipments of copper concentrates, blaming restrictions on transport in the Wuhan province for causing logistics difficulties.


Faced with the current uncertainties, commodity exchanges reacted with falling prices and the London Metal Exchange was no exception. The three-month listing for aluminium high grade was recently at around US$ 1 703 while aluminium alloy was valued at US$ 1 390. Stocks in the LME licensed warehouses were at 1 138 975 tonnes (HG aluminium) and 8 180 tonnes (alloy).

Even so, new metal business on the aluminium market was revived somewhat by the lower prices with many buyers replenishing their stocks more cheaply. On the other hand, there has been little contact with Chinese partners, not least because travel has largely ceased. Alloy prices in Europe were recently US$ 2275 – 2385 for the alloy 226 and US$ 2330 – 2450 for the alloy 311.

The aluminium scrap market remained weak despite low prices. There is sufficient material available on the market, so sales are difficult. Aluminium profile scrap cost US$ 1555 – 1710 and new aluminium alloy scrap around US$ 1 305. Prices for cast aluminium scrap ranged from US$ 925 – 990. Aluminium chips fetched US$ 620 – 825.

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