Chinese importers hit pause on copper scrap from US as talks of new tariffs weigh

Several Chinese importers have slowed down intakes of copper scrap from the US amid concerns around China's potential counteraction against President-elect Donald Trump's tariff escalation on Chinese goods, industry sources said Nov. 29.

Chinese buyers are already facing added scrutiny after the country in November created a stricter standard to import recycled copper and aluminum raw materials.

So far, leading Chinese copper scrap consumers have not been affected due to tight copper raw material supply in the domestic market, sources said. However, smaller importers could apply more caution to avoid potential risks of losses or default, they added.

"We [have stopped buying] low-quality brass copper and purple copper [a few weeks before] China released the new import policy. We are buying the recycled copper raw materials meeting the requirements of national standards now," said a key copper scrap consumer in China.

"We haven't reduced the imports of copper scrap due to tight supply in the domestic market," said another key copper scrap consumer in China.

Market sources are closely watching scrap imports as a tight supply of raw materials prevails.

China's new policy released Nov. 15 set higher requirements for imports of recycled copper and aluminum raw materials.

This forced importers to pay more attention to the performance index and quality of imported materials to avoid extra tax and costs caused by non-conformity with the new standards, sources said.

China is now imposing a 1.5% tax on imported recycled copper and brass if materials fail to meet the new requirements, even if the quality is in line with the customs standards, according to the new policy. Moreover, it will also levy a 1.5% tax on recycled copper and aluminum materials, which were newly added to the import category.

This will increase import costs and thus is weighing on the buying interest of Chinese importers, sources said.

Trump's pledge creates ripple

Incoming US President Trump recently said he will impose an additional 10% tariff on Chinese goods coming into the country, while during the campaign he vowed to implement a 60% tariff rate, creating more uncertainty for Chinese trade.

China previously had made a countermove to levy a 25% tax on copper scrap and aluminum scrap imported from the US in August 2018, after Trump enacted a 25% tariff on $200 billion worth of Chinese goods.

This led to a significant drop in China's imports of copper scrap and aluminum scrap from the US.

China since then has removed or relaxed the import tax but some buyers remained hesitant to fully commit to US supplies.

A Chinese aluminum scrap consumer said its company has totally stopped importing aluminum scrap from the US since the countertariffs in 2018.

China removed the import tax on US copper scrap and aluminum scrap imports in March 2020 and allowed free imports of secondary copper and aluminum raw materials meeting certain standards since November 2020.

China's imports of copper scrap from the US reached 361,099 mt in the first 10 months of 2024, accounting for 19.5% of the country's total, China customs data showed. The US reemerged as the largest copper scrap supplier to China since 2022.

China's imports of aluminum scrap from the US totaled 112,672 mt in the first 10 months of this year, accounting for 0.8% of the country's total, customs data showed. Imports from the US have been continuing to see a year-on-year decline since 2018, except for a jump in 2022.