China to resume NF scrap imports in November

China will allow the free import of aluminum, brass and copper scrap metal conforming to new standards starting in November.

Approved aluminum scrap will fall under tariff code 7602000020, approved brass scrap will be classified under 7404000020 and copper scrap will be 7404000030, according to a notice from China's General Office of the Ministry of Ecology and Environment.

Imports of scrap not conforming to the new specifications will be prohibited starting next month, unless importers have any remaining allowance from already approved quotas, according to the notice. But major Chinese importers of aluminum scrap have already run out of old quotas, several sources told Argus.

Still, market sources noted that there are still a few key details that were not addressed in the announcement today and will need to be cleared up to ensure smooth shipping activities in November.

The two key concerns that sources cited are confusion over whether exporters will still be required to undergo pre-shipment inspections by the China Certification and Inspection Certification (CCIC) offices and whether tariffs against US-origin non-ferrous scrap imports will be relieved or still in effect.

Despite initial uncertainty, US suppliers approached the announcement with cautious optimism, noting that the former scrap consuming giant's potentially unthrottled re-entry to high-grade non-ferrous scrap imports will boost prices, though most noted that key details still need to be ironed out.

The new scrap standards for copper (GB/T 38471-2019) and brass (GB/T 38470-2019) were announced and published by the State Administration for Market Regulation (SAMR) on 31 December.

Scrap metal must contain 97–99.9pc copper to meet the new standards, with recovery rates for some grades set as high as 99pc. For brass scrap, copper content must be 56-75pc, while the permitted lead level is heavily restricted.

Copper scrap imported into China must not contain unexploded bombs, shells and other explosives. Sealed, pressurized containers and materials classified as dangerous are also banned from imports.

The new standards set purity levels of 98pc for aluminum cast scrap with a 0.7pc allowance for metallic impurity, while for zorba(shredded aluminum scrap) the minimum aluminum purity will be 91pc, with a total metallic content of minimum 99.1pc.

So far this year China has issued 12 tranches of scrap metal import quotas that were approved by China's Solid Waste and Chemicals Management Bureau — a unit of the country's ecology and environment ministry.

The overall scrap metal import quota for the year totals 1.72mn t — comprising 879,475t of copper scrap, 818,664t of aluminum scrap and 23,110t of ferrous scrap.

By John Betz and Brad MacAulay