Respite From Trade War to Boost Non-Ferrous Market Recovery

SEATTLE (Scrap Monster): The recovery of non-ferrous scrap market is entirely dependent on the ongoing global trade war. Any respite to this would lead to significant recovery in market, noted the Bureau of International Recycling (BIR) meet held recently in London. The above view was expressed by Edward Meier of the Commodity Research Group.

The Chinese trade has almost halved from 35% of GDP in 2006 to nearly 18% in 2017. During the previous year, China reported steady decline in aluminum scrap imports, which totaled 2.17 million tonnes. The imports during the three-month period from April to June this year, the imports averaged at around 115,000 tonnes per month, registering decline by more than 40% over the comparable period in 2017.

On the contrary, Mexico recorded notable surge in imports of aluminum from the U.S. The year-on-year exports have increased by almost 20% so far in 2018.

The above trends clearly indicate the impacts of tariffs on U.S. trade of non-ferrous scrap materials. Things have become worse after the Trump administration ordered to have 10% tariff imposed on imports of non-ferrous metals. According to Meier, tariffs have not been successful in solving any problem so far. Rather, they are feared to create more problems in future, he added.

The BIR meet predicted that aluminum prices are likely to range between $1,910 and $2,380 per tonne in 2019. Also, copper prices are likely to remain in the range $5,600-$7,200 per tonne during the next year.