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Chinese metal markets preparing for 'severe' change

The Chinese metal market could face big changes as the country considers a ban on imported scrap and volumes continue to decline, the Bureau of International Recycling (BIR) has been told.

The comments were made at BIR’s recycling convention in Hong Kong where Ma Hongchang, BIR’s adviser on Chinese policy and regulatory developments, urged exporters to pay attention to the country’s scrap import policy trends and adjust their business models accordingly.

Ma said it was possible the government could ban imports of certain grades of mixed metal scrap, although authorities have not yet issued timetables or details of categories to be banned.

Copper and aluminium scrap are likely to be subjected to a “tough” review to determine whether imports could continue, he added.

BIR non-ferrous metals division president David Chiao warned of “very severe weather coming towards us”.

Hong Yang, deputy managing director of Minmetals, said China’s domestic supply of copper scrap had overtaken imports and that this trend could be expected to continue.

“Scrap imports are declining all the time,” he said, adding that domestic scrap production was expected to increase by 17% this year.

China remains the world’s leading buyer of copper scrap. Yang said imports were “likely to continue to play an important role” as official government data indicated that the country would require an annual total of 4.4 million tonnes of copper scrap from all sources by 2020 due to an expected increase in infrastructure building.

Copper scrap imports from Europe and the US were on the decline while Asian countries were increasing their share of total shipments to China.

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