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Discounts on copper scrap imported into China have remained largely stable over the past month despite fluctuations in London Metal Exchange (LME) copper. The resilience of relative prices, however, conceals a market less straightforward than the price table alone suggests: refined copper is attracting purchases ahead of the holidays, while users of recycled material face resistance when they try to pass higher costs on to customers.
The problem is visible in the copper rod supply chain. Scrap bought at high prices raises the cost of recycled copper rod, but wire and cable manufacturers remain reluctant to accept higher offers. Even when the price gap between refined copper and scrap widens, the theoretical advantage for processors of secondary material must be weighed against their actual ability to sell the finished product. A stable discount to the LME does not, by itself, guarantee stable demand.
Refined Copper Rises, Secondary Copper Struggles
In the week of September 14-18, the average LME three-month copper closing price was $14,283 per tonne, against $14,488.50 the previous week. The decline was $205.50, or about 1.4%. In the following days, however, the market recovered: during Tuesday’s trading, the three-month contract came to around $105 of its record high, according to the reported market indications.
Attention on refined copper was supported by the cancellation of warrants covering another 12,000 tonnes in LME-registered warehouses and reported Chinese buying ahead of the Mid-Autumn Festival. The holiday in China begins on Friday September 25. A warrant cancellation identifies material intended for withdrawal from the warehouse system; it does not, on its own, show that those tonnes have already been shipped to China.
The premium for grade A copper cathodes delivered cif Shanghai rose to $90-110 per tonne on September 23, from $70-85 a month earlier. Its midpoint moved from $77.50 to $100 per tonne. This strengthening of the physical refined copper market has not automatically carried through to secondary products: copper rod and cable buyers continue to resist increases linked to the cost of scrap.
How To Read Discounts To The LME
Imported scrap is often traded at a percentage of the LME three-month price. An indication of 97% of the LME means that the material is priced 3% below the reference used in the negotiation. The same difference can be expressed in US cents per pound. Both measures describe price, not the percentage of copper contained in the scrap. The LME confirms that its prices are also used as references in secondary copper contracts.
When the LME price changes, an unchanged percentage discount can correspond to a different monetary discount. At an indicative reference of $14,283 per tonne, one percentage point is worth about $143 per tonne, equivalent to roughly 6.5 cents per pound. The calculation helps interpret offers; it does not replace the actual price of a shipment, which also depends on the pricing date, quality and contract terms.
| Scrap Grade, Cif China | Price Indications Against LME 3M | September 21 Discount | Previous Week |
|---|---|---|---|
| Bare bright, barley/millberry | 99-99.5% | 3-6 ¢/lb | 3-7 ¢/lb |
| No. 1, candy/berry | 96.5-98% | 13-23 ¢/lb | 13-23 ¢/lb |
| No. 2, birch/cliff | 95-96% | 26-32 ¢/lb | 26-33 ¢/lb |
| No. 1 nodules, clove | 97-98% | 13-19 ¢/lb | 13-20 ¢/lb |
| No. 2 nodules, cobra | 96-97% | 19-26 ¢/lb | 20-26 ¢/lb |
The percentages summarize market participants’ indications of workable prices or transactions; the ranges in ¢/lb are the weekly assessments. They should not be read as exact equivalents for every individual trade.
The distinction between grades is essential. Under ReMA specifications, barley identifies bare copper wire; berry is clean wire and candy is heavy copper and tubing. Birch/cliff combines No. 2 materials, while clove and cobra identify copper wire nodules of different grades. These names help buyers and sellers define the material covered by a contract: discount ranges also differ because the required characteristics of the scrap differ.
Little Change In Spot Negotiations
For bare bright copper wire, market participants reported deals at 99-99.5% of the three-month LME price, with some indications extending to prices equal to the LME reference. The weekly discount range of 3-6 cents per pound was unchanged from a month earlier. Compared with the previous week, however, its upper bound fell from 7 to 6 cents. Monthly stability therefore coexists with a small weekly narrowing.
For No. 1 candy/berry material, deals were reported at 97-97.5% of the LME, equivalent under the cited conditions to discounts of 16-19 cents per pound. The range participants considered workable was wider, at 96.5-98% of the LME; the weekly assessment remained at 13-23 cents per pound, unchanged since the start of September. It is useful to distinguish prices of reported transactions from the full range regarded as negotiable.
For No. 2 birch/cliff, too, workable indications remained at 95-96% of the LME, with a weekly discount of 26-32 cents per pound, against 26-33 cents the previous week. Bids appeared at 93.5% of the LME, substantially below the range identified as possible for concluding deals. A bid does not necessarily represent a price at which a seller will agree to deliver material.
Liquidity was also limited for copper wire nodules. No. 1 clove was indicated at 97-98% of the LME and No. 2 cobra at 96-97%. Their respective discount ranges were 13-19 and 19-26 cents per pound. In the first case, the range narrowed by one cent at its upper end; in the second, it widened downward by one cent. These are small adjustments, consistent with a market that has not found a new common direction.
Copper Rod Demand Is The Constraint
The relative stability of discounts does not remove pressure on Chinese processors. If scrap remains expensive in absolute terms, producing secondary copper rod requires higher selling prices to protect margins. Wire and cable manufacturers, however, show little willingness to accept them. A wider price gap between refined copper and scrap, or between refined-copper rod and secondary rod, does not automatically turn into additional sales of recycled material.
The different roles of the quotations also matter. The cif Shanghai premium concerns imported refined cathodes; the cif China discount concerns specific scrap grades against three-month LME copper. Placing them side by side helps show where demand is concentrated, but directly subtracting one range from the other does not measure the margin on copper rod production. Actual copper recovery, processing, transport and the price accepted by the customer complete the calculation.
August Imports Slow
In August, China imported 177,413 tonnes of copper scrap under customs code HS 7404, against 219,111 tonnes in July and 179,290 in August 2025. The monthly decline was about 19%, while the annual decline was around 1%. The reading therefore changes with the period chosen: August shows a sharp drop from the previous month, but volumes close to those of a year earlier. HS code 7404 covers a broader range of copper scrap than the five grades in the price table alone.
| Origin | Chinese Imports In August | Change From July | Annual Change |
|---|---|---|---|
| Total, HS 7404 | 177,413 t | −19% | −1% |
| Thailand | 30,114 t | −18% | +0.26% |
| Japan | 27,140 t | −22.89% | −23.43% |
| Spain | 11,432 t | −4% | +20% |
| United States | 1,698 t | −7% | +212% |
Thailand was China’s largest supplier in August, ahead of Japan. Both countries shipped less material than in July, but the Japanese decline was more pronounced on an annual basis as well. Spain ranked third among the listed origins, with volumes below July’s but above those of August 2025. The changes therefore do not describe an even contraction across all trade routes.
Direct shipments from the United States remained limited at 1,698 tonnes. The 212% annual increase needs to be read alongside that quantity: the comparison is with an already very low base in 2025, following the sharp reduction in purchases of US material recorded from June of that year. A high percentage increase does not, in this case, mean a return of the United States to the ranks of China’s main suppliers.
The Signal To Watch After The Holidays
China’s scrap market enters the Mid-Autumn Festival break with two different signals. On one hand, the higher cathode premium and the recent recovery in LME copper point to interest in refined metal. On the other, caution among wire and cable manufacturers limits the secondary supply chain’s ability to absorb scrap purchased at high prices. Largely unchanged discounts describe the relative price of offers; they do not resolve the problem of end-user demand.
In the next negotiations, it will be useful to watch whether copper rod buyers accept higher prices and whether imports resume growth after August’s decline. A strong LME price can support scrap’s value in dollars even without major changes in percentage discounts; weak industrial demand can instead curb the quantities purchased. For now, the market can be summarized as follows: stable relative prices, slowing import volumes and margins under pressure for processors turning scrap into new products.
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