SMM

According to the latest data from the General Administration of Customs, China's imports of copper scrap and shredded copper scrap in November 2024 totaled 173,500 mt, down 5.25% MoM and 5.14% YoY. From January to November 2024, cumulative imports reached 2.0325 million mt, up 13.76% YoY (HS code 74040000).

Customs data shows that November secondary copper raw material imports declined as expected both MoM and YoY, mainly due to the following reasons:

First, the export volumes of China's major secondary copper raw material suppliers, including the US and Malaysia, decreased. Due to policy uncertainties following Trump's election, importers in Ningbo suspended procurement of US-origin materials starting in late November. Customs data indicates that US exports of copper scrap (copper scrap and shredded copper scrap) to China in November were approximately 33,900 mt, down 4% MoM and 9% YoY. Additionally, Malaysia's port operations have been stagnant since September, affecting import and export activities. Its exports of copper scrap to China in November were about 16,600 mt, down 5% MoM and 6% YoY.

Second, regarding import profit and loss, secondary copper raw material imports in October were mostly in a loss-making state, with the import window briefly turning profitable only at the end of October. This severely dampened the procurement enthusiasm of secondary copper raw material import traders. In November, although the import window remained mostly open, import traders in Ningbo reported that due to tight market supply and financial pressures, their procurement volumes did not increase significantly.

Currently, while imports from the US and Malaysia have declined, the decrease is within expectations. According to the latest SMM updates, customs clearance at Malaysia's Port Kelang West is gradually resuming, and Malaysia's secondary metal exports are expected to return to normal soon. However, with Trump's election victory in November, market concerns over a potential tariff hike intensified. Copper prices fell and remained in the range of 73,000 yuan/mt to 74,500 yuan/mt, leading domestic and overseas suppliers to hold back cargoes, resulting in very limited market supply. Additionally, traders noted that with year-end financial pressures mounting, there is no need to purchase excessive volumes of goods. Furthermore, market sources indicate that starting January 2025, the "reverse invoicing" policy will be fully implemented. According to SMM, many secondary rod manufacturers have expressed significant uncertainty about the future and revealed plans to shut down furnaces temporarily in January to observe the market. This suggests that demand for secondary copper may decrease, potentially impacting secondary copper raw material imports in the short term.