NEW YORK An ongoing
copper scrap shortage and a decline in Comex copper prices
caused discount spreads to narrow March 20, as availability
concerns began to present significant headwinds for scrap
dealers, sources said.
"Business has been miserable. I
wish I could tell you there was something going on. People are
banging on my door to buy material. ... I dont have
anything to sell them," one scrap trader said.
"There is nothing going on in
peoples yards," a second trader said. "Everyone is
calling around to see if the others are slow. I havent
seen things this sparse in quite some time."
The discount for brass
mills No. 1 copper scrap fell to 4 to 6 cents below Comex
compared with a 6- to 8-cent discount a week earlier, putting
prices at about $3.39 to $3.41 per pound based on a March 20
Comex copper price of $3.4465 per pound for May delivery.
Meanwhile, the discount for refiners copper scrap No. 1
dropped to 14 to 16 cents from 18 to 20 cents previously,
putting March 20 prices at around $3.29 to $3.31 per pound.
Refiners No. 2 discounts tightened to 31 to 33 cents, or
$3.12 to $3.14 per pound, from a 33- to 35-cent discount March
"Its definitely been a
while since I have seen spreads come in this much," a third
"To a large extent, scrap is
still very tight," a fourth trader said. "The demand picture is
still decent, though I cant be sure whether that is
because there is a lack of supply or there is actually
increased demand. My guess would be that overall demand is
being exacerbated by the lack of supply."
Discounts for brass ingot
makers No. 1 bare bright dipped to 6 to 9 cents, putting
prices at about $3.36 to $3.39 per pound March 20, down from a
7- to 10-cent discount previously, while discounts for brass
ingot makers No. 1 slimmed to 17 to 19 cents, or $3.26 to
$3.28 per pound, vs. an 18- to 20-cent discount previously. No.
2 discounts fell to 31 to 35 cents, or $3.10 to $3.14 per
pound, from a prior discount of 33 to 37 cents, and light
copper tightened to a 44- to 47-cent discount from a 46- to
50-cent discount previously, putting prices at $2.98 to $3.01
Copper scrap prices are lower
than in previous weeks due to the decline in Comex copper
prices and a lack of any significant pickup in demand. The
May-delivery Comex copper contract weakened further March 21,
settling at $3.435 per pound.
Meanwhile, brass scrap prices
held steady March 20, with market participants noting that
consumers continued to compete for adequate shipments of
"Unlike copper scrap, brass
scrap is not tied to Comex," one brass scrap trader said.
"Its not one-for-one. If you find a consumer that needs
brass scrap, you will be shocked at what they are willing to
pay right now. The dynamic is pretty simple: Demand is