Source: International Copper Study Group

Over the course of 2015, London Metal Exchange (LME) prices per tonne of copper, aluminium and nickel were on a downward slide, with the price of nickel dropping most significantly, having lost almost 35 percent of its value between January and November.

LME prices for copper declined by about 17 percent over the same period, while aluminium prices, seemingly the most stable of the three, fell by about 13 percent during the first 11 months of the year.

A major factor affecting the current weakness in nonferrous scrap markets, recyclers say, continues to be the questionable economic health of China, with its economy on track to grow at a rate of between 6 percent and 7 percent in 2015, far less than boom-time rates. The level of aluminium production in China and its exports of semifabricated aluminium products also are cited as factors that have been threatening the scrap industry.

David Chiao of Atlanta-based Uni-All Group Ltd. and president of the Bureau of International Recycling (BIR) Nonferrous Division, says for the past year or so, aluminium consumers in China have increasingly used cheaper primary aluminium ingot rather than more expensive aluminium scrap to produce aluminium alloys. Conditions in the copper scrap sector also leave much to be desired, Chiao says, with low demand from Chinese consumers and generation down as well.

* In thousands of tonnes. Source: International Copper Study Group

Will Adams of London-based commodities research service FastMarkets ( says recent Chinese trade data show exports of unwrought aluminium and aluminium products jumped 38.4% month on month to a level of 450,000 tonnes in November, while January-to-November exports rose 14.3% from the same period in 2014.

However, he adds, “Going forward, low prices and the significant fall in physical premiums that were available earlier in the year are likely to make exports of aluminium from China less profitable, which should see volumes fall.”

Adams also says signs indicate less scrap is available as lower prices are seeing less material being sold, with scrap merchants hoarding more inventory waiting for better prices.

While Chiao points out consumers in India have been a source of demand for some aluminium, stainless steel and yellow brass scrap, buyers there are not demanding the wide spectrum of products that Chinese consumers sought in years past.

Dhawal Shah, director of the Indian metals trading company Metco Marketing, based in Mumbai, observes that finding suitable raw materials has not been an issue his company has encountered. He says the fact that conditions have slowed in other buying markets such as China and Korea, perhaps has even made scrap availability better for Indian consumers.

“I don’t really feel squeezed,” he says. “My buyer is able to buy what he wants.”