Tokyo Copper Scrap Dealers to Reduce Supply for Rolled Copper Makers

Copper scrap dealers around Tokyo try to change price settlement mechanism and reduce the supply volume for April-June period at negotiation with rolled copper makers under tight supply and higher market price. The dealers have trouble to secure the scrap in the sellers’ market. The dealers try to change the condition for high grade scrap including no.1 copper wire scrap. The scrap generation is getting low especially in the year when rolled copper makers try to utilize the inner scrap for themselves while copper products processors try to improve the yield for better profitability. The higher scrap export also reduces the supply for domestic market. Under tight supply, no.1 copper wire scrap price reached 835 yen per kilogram and some pay more than 860 yen. The dealers cannot make money at the purchase price but they have to buy scrap to keep the supply commitment for the rolled copper makers through March to avoid penalty. The dealers said they cannot keep the supply volume for April-June. They try to reduce the commitment volume for rolled copper makers for the period. They also seek flexible price mechanism including premium addition depending on market condition.