Copper scrap market faces challenges in China by 2025 – Fastmarkets
Market analysts and industry insiders predict a challenging year ahead for the secondary copper and blister markets in China, the global leader in copper raw material imports. The ongoing US-China trade tensions, combined with limited supply growth due to copper smelter expansions, and a persistent tightness in the copper concentrate market, are expected to create a tighter supply environment in 2025.
Despite these challenges, some relief may come from China’s relaxed import controls, increased offshoring practices, and the continuous enhancements in scrap collection efficiency. Chinese copper scrap imports saw an uptick in 2024, reaching 2.03 million tonnes from January to November, a 13.7% increase compared to the previous year. This surge is attributed to the tightness in the copper concentrate supply and the country’s interest in producing low-carbon emission materials.
Looking ahead to 2025, market participants are cautious about the potential resurgence of US-China trade tensions, especially with concerns about policies under the new US administration. The uncertain outlook has led some buyers to avoid US-origin copper scrap imports, waiting for clearer signals. Although China recently eased restrictions on recycled copper imports, concerns over a trade war continue to impact market sentiments.
China’s copper scrap imports for November 2024 declined by 5.25% month-on-month, reflecting the uncertainties surrounding trade policies. The looming threat of escalating tariffs between the US and China could worsen scrap shortage concerns, as the US remains a significant supplier of high-purity copper scrap to China. Additionally, the opening of new smelters in both countries in 2025 could further strain the supply chain.
To address potential disruptions, Chinese companies are exploring offshoring options for the pre-processing of lower-grade scrap in countries like Malaysia and Thailand. However, this has led to intensified competition and rising raw material costs in the market. The increased interest in utilizing copper scrap in Asian countries, apart from China, Japan, and South Korea, has further fueled the market competition.
Despite these challenges, the secondary copper industry in China has been growing steadily, backed by government initiatives to support its development. Recycled copper output in China is projected to reach 4.3 million tonnes in 2024, up from 4.1 million tonnes in 2023. However, industry insiders acknowledge that there is still a long way to go in terms of regulation and market development.
In conclusion, the outlook for the secondary copper and blister markets in China in 2025 is marked by uncertainties, challenges, and evolving market dynamics. While supply concerns loom large, the industry remains resilient, adapting to changing market conditions and government policies to sustain growth and development in the years to come.
