BIR World Mirror on Non-Ferrous Metals – Issue January 2023: Concerns grow as new EU shipment rules move a step closer
A concise summary of the BIR World Mirror on Non-Ferrous Metals – Issue January 2023. Full version with detailed market reports available in the Members Only section of the BIR website.
The January 17 decision by the European Parliament to approve a revision of the EU Waste Shipment Regulation has contributed to a mixed start to 2023 for recyclers, according to the latest World Mirror on Non-Ferrous Metals from the BIR global recycling organization.
If the current revision proposal completes legislative steps at the EU Council of Ministers, exports of non-ferrous scrap to industrialized and developing countries outside the EU will be heavily burdened by intergovernmental agreements and inspections, audits and checks on facilities in third countries. In response, BIR has urged the governments of OECD and non-OECD countries to look carefully at the impact of these proposed laws on the material needs of their own industries.
In another legislative hurdle for the recycling industry, the government of South Africa has introduced its six-month export ban on copper, brass, gunmetal and ferrous scrap. Aluminium and stainless steel scrap can still be exported through the International Trade Administration Commission although the associated tax must be paid before shipping the material.
On the plus side from a regulatory perspective, China’s recent dismantling of its controversial zero-COVID policy is expected to trigger more aggressive growth. In this context, it is confirmed that China’s import volumes for recycled copper and aluminium raw materials remain high owing to the large number of new projects in the country’s metal recycling industry and an insufficient domestic supply.
Indeed, Japan reports that its shredded aluminium scrap market is being sustained by stronger demand from China. According to feedback from South East Asia, meanwhile, discounts for No. 1 and No. 2 copper scrap narrowed considerably in the final months of 2022 as many of China’s copper producers competed for red metal units for their year-end. This good demand for copper-bearing scrap has carried over into the early weeks of 2023.
Pakistan is experiencing more limited scrap import activity, however, because of its central bank’s lack of foreign reserves; this is exacerbating the shortages of all types of material resulting from extreme weather conditions in Pakistan itself. Freezing temperatures and heavy snowfalls have led to a slow start to the year in other countries too, notably Canada, whereas scrap flows in most parts of Europe appear to have been smoothed by a milder-than-normal winter and by the sharp rise in LME prices. From the Iberian Peninsula, it has been reported that these high LME values have boosted demand and created material shortages on the market.
While the Ukraine conflict and the associated uncertainties continue to dampen general market confidence, blackouts in the country are now mostly scheduled such that businesses can plan their operations accordingly. In Russia, meanwhile, scrap availability has been compromised by winter weather conditions and by an unfavourable ruble rate. The weakness of the Russian economy has triggered metal theft on an enormous scale, it is also reported.