NEW YORK Ingot makers red brass scrap prices continue to drop as demand for the metal dries up, market participants said.
"This is the biggest revenue change in my buying career," a copper scrap buyer said. "Ingot makers always wanted (red brass), but today theyre not going to buy it."
Red brass scrap is now in a range of $2.45 to $2.49 per pound, down from $2.46 to $2.50 previously, consumers, traders and sellers told AMM.
"A lot of people had backed away from (red brass)," a scrap seller said, adding that he believes some interest may come back from overseas. Sources said that demand had softened in part due to weak export markets and regulations that limit the amount of lead in piping.
Since a lot of red brass scrap has too much lead in it, businesses have adapted by providing replacement material, the first scrap buyer said, noting that replacing leaded red brass is now 20 to 25 percent of his business.
Generally, the scrap market is "slower rather than steady," sources said.
"The end markets are very soft, and the export market is exceedingly soft," a second copper scrap consumer said. According to U.S. International Trade Commission data, copper scrap and waste exports to China and India, two major developing economies, have declined 8.6 percent and 21.6 percent, respectively.
The softening in Chinas market has affected refiners copper scrap as well. "China has not been as aggressive, therefore No. 2 spreads have widened," a scrap seller said in an e-mail.
Refiners scrap No. 1 discounts have increased to 8 to 10 cents per pound from 6 to 8 cents previously, putting the price at $3.17 per pound based on the December Comex copper contract, which settled at $3.257 per pound Sept. 11. Refiners scrap No. 2 discounts widened to 25 to 28 cents per pound from 22 to 24 cents previously, putting the price at $2.995 per pound.