Scrap that: China’s metal recyclers rush to divert or sell U.S. cargoes as tariffs loom

0 comments

Scrap that: China’s metal recyclers rush to divert or sell U.S. cargoes as tariffs loom

Chinese copper fabricators and importers are scrambling to divert or resell cargoes of U.S. copper scrap en route to China after Beijing hit such imports with a 25-percent duty as the trade row with Washington deepens, sources said.

U.S. scrap metal, waste paper and plastics cargoes arriving in China from Aug. 23 will incur the new levy after China announced on Wednesday its final list of tariffs on $16 billion of U.S. goods. Scrap was not on a draft list released in June.

In the first quarter there were almost 2,200 cargoes of copper scrap per month sent to China from the United States, according to Reuters’ calculations based on customs data. The average cargo of scrap copper sent to China is about 20 tonnes.

With less than two weeks before the new tariffs come into effect, China’s imposition of duties threatens to disrupt trade for one of the world’s top metal and scrap consumers, as recyclers rush to find new homes for cargoes to avoid paying new duties.

“Last night I lost sleep,” an executive at a metals recycler with processing yards in Zhejiang province said on Thursday. He has several cargoes of U.S. scrap copper due to arrive in Ningbo port after the deadline or about to load on the U.S. East and West coasts.

“We don’t have a solution yet, but we’re discussing it with the supplier,” he said, adding he was looking for buyers in Japan, South Korea, India and even Europe.

Those importers with stranded cargoes will likely have to offer discounts to attract buyers, sources said.

The penalties are China’s latest blow to the U.S. recycling sector, after Beijing hit aluminum scrap with hefty duties in April as part of the trade dispute.

“The impact will be draconian on both U.S. scrap processors and Chinese consumers,” Michael Lion, Hong Kong-based president of Lion Consulting Asia and a Chinese metals industry veteran, said in an email.

Companies such as Sims Metal Management and Nucor Corp’s scrap subsidiary David J Joseph are major exporters of U.S. scrap to China and elsewhere.

Last year, the United States sold almost $6 billion worth of scrap commodities to China and was the second-largest supplier of copper scrap behind Hong Kong, exporting 535,371 tonnes worth roughly $1.8 billion in 2017. Hong Kong sent 627,180 tonnes, according to Chinese customs data.

The global recycling sector is also reeling from Beijing’s tighter restrictions on waste imports introduced over the past year as China aims to stop being the dumping ground for the world’s garbage.

China’s scrap metal imports dropped by a third in the first half of 2018 to 2.86 million tonnes, while the country has barely imported waste plastic this year.

An executive with a major scrap metal recycler in Asia said there would likely be a combination of resales, trans-shipments and reluctant payment of the 25-percent tariff.

“Those that can resell may see (that) as the best option even if at lower numbers as there is always risk in trans-shipment,” the source said, adding that there were “many” cargoes already on the water.

An executive at a Zhejiang-based copper rod maker, which uses scrap as raw material, also said shipments via a third-country were an option, although cargoes could even be sent back to the United States after docking in China.

The three executives declined to be identified because they are not authorized to speak to the media.

Responding to the news, the Washington-based Institute of Scrap Recycling Industries (ISRI) warned that China may struggle to find enough material from other countries.
Source: Reuters (Reporting by Tom Daly; editing by Josephine Mason and Eric Meijer)

Leave a Reply

SSCP   CAS-002   9L0-066   350-050   642-999   220-801   74-678   642-732   400-051   ICGB   c2010-652   70-413   101-400   220-902   350-080   210-260   70-246   1Z0-144   3002   AWS-SYSOPS   70-347   PEGACPBA71V1   220-901   70-534   LX0-104   070-461   HP0-S42   1Z0-061   000-105   70-486   70-177   N10-006   500-260   640-692   70-980   CISM   VCP550   70-532   200-101   000-080   PR000041   2V0-621   70-411   352-001   70-480   70-461   ICBB   000-089   70-410   350-029   1Z0-060   2V0-620   210-065   70-463   70-483   CRISC   MB6-703   1z0-808   220-802   ITILFND   1Z0-804   LX0-103   MB2-704   210-060   101   200-310   640-911   200-120   EX300   300-209   1Z0-803   350-001   400-201   9L0-012   70-488   JN0-102   640-916   70-270   100-101   MB5-705   JK0-022   350-060   300-320   1z0-434   350-018   400-101   350-030   000-106   ADM-201   300-135   300-208   EX200   PMP   NSE4   1Z0-051   c2010-657   C_TFIN52_66   300-115   70-417   9A0-385   70-243   300-075   70-487   NS0-157   MB2-707   70-533   CAP   OG0-093   M70-101   300-070   102-400   JN0-360   SY0-401   000-017   300-206   CCA-500   70-412   2V0-621D   70-178   810-403   70-462   OG0-091   1V0-601   200-355   000-104   700-501   70-346   CISSP   300-101   1Y0-201   200-125  , 200-125  , 100-105  , 100-105  , CISM   NS0-157   350-018  , NS0-157   ICBB  , N10-006 test  , 350-050   70-534   70-178   220-802   102-400   000-106   70-411  , 400-101   100-101  , NS0-157   1Z0-803   200-125  , 210-060   400-201   350-050   C_TFIN52_66  , JN0-102  , 200-355   JN0-360   70-411   350-018  , 70-412   350-030   640-916   000-105   100-105  , 70-270  , 70-462   300-070  , 300-070   642-999   101-400   PR000041   200-101  , 350-030   300-070  , 70-270  , 400-051   200-120   70-178   9L0-012   70-487   LX0-103   100-105  ,