Copper Scrap Price Stays High with Low Inventory

The market price of no.1 copper wire scrap, a most major item of copper scrap, maintains high at around 875-905 yen per kilogram in Tokyo when the domestic official copper ingot price, an indicator for copper scrap prices, stays at the level as high as 1 million yen per tonne. Copper scrap generation is decreasing after summer. In early September, some dealers became suffered from harder procurement of copper scrap enough for contracted volumes with scrap users such as copper alloy product makers. Market dealers are raising their purchase price to secure enough volumes of copper scrap.Most scrap dealers hurry to secure copper scrap in October when their shipment is increasing for long-term contracts with domestic copper alloy product makers. Scrap dealers must pay the penalty if they failed to supply enough copper scrap to copper alloy product makers. Consequently the dealers are raising their purchase price for copper scrap despite of a concern that copper metal price might drop down suddenly. Some dealers offer the purchasing price almost as same as the selling price.Long-term contract volume seems almost same or less compared with autumn 2006. Copper alloy product makers are not so active to purchase copper scrap with little spot demand. Scrap dealers are applying their inventory to the supply to copper alloy product makers even though the demand is not so strong. The market condition would maintain unless scrap generation recovers.