Sharp Decline of Japanese Cu Scrap Export Price for China

Japanese copper scrap export price for China is plunging. The price dropped down by about 25% within a month to reflect the sharp decline of overseas copper metal market. Another background is that Japanese exporters are forced to lower the selling price for China since Chinese demand for copper scrap hasn’t recovered even after the Beijing Olympic closed. Copper scrap price seems to continue decreasing as long as copper metal market maintains weak.

Japanese export price of mixed copper wire scrap, the main item among copper scrap exported from Japan to China, is currently 200-220 yen per kilogram, which was around 300 yen per kg at the beginning of September. The export price also downed to around 400 yen per kg for brass scrap containing other metals such as iron from around 500 yen per kg in early September.

Copper metal spot price at London Metal Exchange dropped down by about 15% or about US$ 1,000 per tonne during the same term, which is currently around US$ 6,300-6,400 per tonne. The price down rate of copper scrap is even higher than copper metal.

Large price down of copper scrap is caused by weak demand from Chinese buyers even after the Beijing Olympic. One of Chinese large copper alloy fabricators is said that they are going to halt copper scrap procurement because their production is decreasing by more than 60% year-on-year due to slow export for Europe and USA.

Japanese exporter sources point out weakness of copper metal market is also impacting copper scrap prices. One source said Chinese buyers tend to postpone copper scrap procurement when copper metal market is remarkably surging or declining in order to induce cheaper price.

There seems severe price competition among some Japanese exporters those who want to advance stock turnover. As a result, Japanese domestic market of copper scrap is also sharply declining.