China issues third batch of scrap metal import quotas

The Chinese government has approved just under 100,000t of scrap metal imports in the third quarter in its third batch of quotas announced today.

The additional quotas issued today by China Solid Waste and Chemicals Management, part of the environment ministry, are for 99,370t of copper, aluminium and ferrous scrap for delivery to ports in south, southeast and north China.

The extra quota for copper scrap — under harmonised tariff code 7404000090 — is 87,680t, the quota for aluminium scrap — tariff code 7602000090 — is 11,290t and ferrous scrap is 400t.

The copper scrap quota is for delivery to the ports of Tianjin, Ningbo, Shanghai, Xiamen, Qingdao, Nanhai, Nansha and Wuzhou, while the aluminium scrap quota is for Tianjin, Nanhai and Nansha.

The amount of third-quarter copper quotas approved to date stands at 452,559t, aluminium at 372,476t and ferrous at 20,918t.

The import quota for copper scrap is below the amount imported in the third quarter of last year, whereas the aluminium scrap quota is above last year's third-quarter import figure.

China imported 624,276t of copper scrap and 349,510t of aluminium scrap in July-September 2018, customs data show.

Although the scrap metal import quotas are lower than expected, many plants in China are not operating at capacity because of weak manufacturing orders. Demand for scrap metal has been lagging as a result.

"There is no licence issue, [the Chinese firms] can't even fulfil their quotas because the market is so slow," one European supplier said.

Under the new policy, all scrap metal importers in China will need import licences issued under approved quarterly quotas from 1 July before they can receive any material.

The previous quotas were announced on 10 July and 20 June. It is unclear if another batch will be issued before September.

China imported 5.32mn t of scrap last year, of which copper accounted for 45pc, or 2.41mn t, aluminium 1.57mn t and ferrous 1.34mn t.