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Chinese non-ferrous buyers 'moving from scrap'

Non-ferrous alloy businesses in China are said to be turning away from their traditional scrap metal input, adding to pressure on exporters of recycled metals.

The concern has been raised by David Chiao, president of the non-ferrous division of the Bureau of International Recycling, in its latest newsletter.

Chiao referred to reports from the 2015 annual convention in November of the recycling metals branch of the China Nonferrous Metals Industry Association.

He said global uncertainty was prompting Chinese consumers to adopt a ”pessimistic buying stance”.

“At one of the sessions consisting of foreign scrap suppliers and Chinese buyers, it emerged that an increasing number of China’s non-ferrous alloy consumers are using primary grades, refined grades and copper cathode rather than their traditional scrap input,” he said. “Certainly, that is a threat to our industry.”

Overall, he said, the global economy faced many uncertainties, particularly the strengthening of the US dollar bringing down almost all commodity prices while China’s weak demand was getting even weaker.

“Not only is the overcapacity in primary metals production very serious, the hidden fact is that primary metals-producing provinces and regions are facing an even tougher task to balance their budgets,” Chiao added.

In the same newsletter, Nick Rose, of Tandom Metallugical (Midlands), a board member of the non-ferrous division, said the aluminium market was struggling in Europe with limited demand not matching supply.

“It has been a very difficult year for the non-ferrous metals industry and all UK traders are hoping for better market conditions in 2016,” he said.

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