The weekly spreads for US domestic copper scrap widened across all grades despite an uptick in prices. All eyes are now on China’s return to the scrap market and its potential impact on the supply and demand curve moving forward.
The Comex spot market closed at $3.15/lb on Tuesday, up from $3.09/lb on Nov 3 after it touched a peak of $3.20/lb on Oct 21.
The spread for US bare bright copper scrap (barley) delivered US consumer widened by 0.3¢/lb to 16.3¢/lb, under the November Comex contract on Tuesday, while the weekly Davis Index for bare bright increased by 5.7¢/lb to $2.987/lb delivered US consumer.
The spread for bare bright wire widened the least of all US grades as it is the most likely to compete successfully amid the current uncertainty in the export market due to the Nov 1 reclass of scrap into China.
The spread for #1 copper (berry/candy) was wider at 28.2¢/lb, under the November Comex contract, with the weekly index for the grade moving up by 5.6¢/lb to $2.868/lb delivered.
The spread for #2 Light copper was worse by 3.8¢/lb at 47.2¢/lb, under the November Comex contract while the index for the grade increased by 3.8¢/lb to $2.678/lb delivered US consumer on Wednesday.
The US copper market continues to struggle with excess supply and tepid demand. However, recent news of China’s return has brought some confidence in demand reviving. Still, those scrap suppliers without access to the export market have difficulty finding homes and, in some cases, have decided not to buy copper scrap across the scale, only taking in what they have under contract for industrial accounts.