The weekly spreads for US domestic copper scrap were rangebound on Tuesday following a sluggish Comex copper market.
Comex copper closed today at $4.2675/lb down by 2.25¢/lb from Jun 29 as the market awaits cues from the auction of the copper reserves in China. Scrap trade, however, is not expected to get affected by this sale as the volume to be auctioned is small and demand in the US copper scrap market remains firm.
The INVEST America bill passed by the US House of Representatives has boosted market sentiment on the long-term demand for the red metal while the continued demand in the domestic scrap market has kept the spreads stable this week.
The Davis Index spread for #1 copper wire & tube trended flat, at 23.5¢/lb under the July Comex contract, with the grade’s weekly transaction price rising by 2.3¢/lb to $4.033/lb delivered.
Spreads for US bare bright copper scrap (barley) widened by 0.6¢/lb to 14.5¢/lb under the July Comex contract on Tuesday, with its transaction price rising by 2.3¢/lb to $4.123/lb delivered US consumer.
For #2 light copper too, the spread widened by 0.5¢/lb to 62.7¢/lb under the July Comex contract while the transaction price for #2 light increased by 2.19¢/lb to $3.641/lb delivered US consumer.
Some mills have already completed buying for July and plan to remain out of the market until mid-August. With a few smelters also shutting down for a couple of weeks during the summer months, demand for copper scrap may ease in the near term. Still, participants are confident about the robust medium-term cues and expect demand to bounce back by the end of next month.