Japan Domestic Supply Tightens for Brass Turning Scrap

Domestic supply tightens seriously in Japan for brass turning scrap and copper nugget. Brass turning scrap is the main material for brass bar and copper nugget is processed from insulated cable scrap. The supply became even tighter when copper scrap is tend to flow out from Japan to overseas in recent years and China and South Korea currently purchase copper scrap at the higher price than Japanese domestic price. In Japan brass bar demand seems to have increased since the end of 2005 and domestic brass bar makers need to increase the purchase volume of brass turning scrap. Brass bar price is possible to be raised if the supply tightness of brass turning scrap continues further.Copper scrap export increased when the scrap price became higher at overseas than in Japan. Copper settlement price at London Metal Exchange surged by around 40% in 2005 and monthly average of Japanese official copper ingot price also rose by around 54%. On the other hand, brass turning scrap price increased by only 33% in 2005 at Nippon Shindo’s purchase price, which is Japanese major copper alloy maker. With short supply of copper scrap, Chinese and South Korean copper alloy makers purchase the materials at 5% higher price than Japanese price. As a result, Japanese copper scrap dealers ship more for offshore market.