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The Revamp of Copper Price in the Scrap Market - Impact of COVID-19

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by - 10/17/2020 90 Views

In recent days, copper prices have crashed amid rising panic about the effects of the coronavirus

 

The best non-precious metal conductor for electricity is copper. It is used in transformers, generators, engines, and power cables. In the making of electronics and electrical parts, copper is often used extensively. Copper has decorative as well as functional applications in pipes and wiring in homes and buildings. Other applications include equipment, automobiles and coins for industrial use.  

In recent days, copper prices have crashed amid rising panic about the effects of the coronavirus, and the reputation of the metal as a barometer for the global economy means that investors are watching to see whether it will continue to fall. It can seem as though the rates adjust on an hourly basis when you're considering selling your scrap metal. On such a short order, why do scrap metal prices shift so dramatically? We will look at the main factors influencing the pricing of scrap metal.

Factors Affecting the Price of Copper Scrap

Demand and Supply

If something is in high demand and low supply, it will be priced higher in almost every transaction throughout history. It is the only constant. It will be priced lower if it is commonly available and in low demand.

Scrap Quality

Is the usable scrap filled with insulation? As the scrap service will need to strip the insulation or clean it up to get top dollar for your metals, you will end up with a lower price. A higher price would still carry new, high-quality scrap.

Scrap Quantity

Are you offering a pound or a truckload of copper scrap? They can offer a better price if the scrap service can get more scrap metal with lower overhead, including a lower number of transactions and transportation.

Location

Are you out in the country where longer distances would have to be shipped to get the scrap to market or in a town where there is a higher cost of doing business? In such cases, you need to plan to get a smaller price for your scrap.

Impact of COVID on Copper Scrap Prices

The global copper scrap price that has been crashed in last March 2020 has climbed about 35 per cent on the LME and now trading at $6,741. In March 2020, copper prices hit their lowest level since January 2016, with three-month copper futures on the London Metal Exchange (LME) touching $4,371 per metric ton. But right now it has restored up around 35% and trading at $6,741/MT.

Despite the shackled global economy, the copper scrap price increase shows firm trends in the global economy. The Wholesale price of Copper Super D.Rod rose in National capital last week at around Rs 2/kg and ended at Rs 502/kg. Copper Super D.Rod Prices has climbed about 20% since March by consuming industries and firming trends in global markets. Delhi Copper Wire Scrap and Mumbai Copper Wire Bar also witnessed a price hike of Rs 2/kg last week and traded at Rs 485 Rs 510/KG.

Note – Scrap price mentioned as of Oct 10, 2020

 

Global Economy of Copper Scrap

The prestige of copper as a barometer for the global economy implies that its outlook is still closely watched. Because of its large variety of end-uses, both in building and in consumer goods such as cars and consumer appliances, it is perceived this way. As such, an economic downturn or recession, which usually sees building come to a halt and customers stop buying, hits copper demand, and therefore metal prices, hard. Like gold, copper’s understanding as a barometer determines the way its price travels. Because of its historic perceived relation to the macro economy, investors and machine-led hedge funds frequently trade copper more than they trade other metals.

Conclusion

The copper recovery has always been an eye-catcher as the red metal is all made up of powerful fundamentals. The prestige of copper is an indication that the global economy is strong. This perspective will still be closely observed. Therefore, copper continues to attract short positions in bear markets and long positions in bull markets when you have bearish environments or bullish environments.

Find visually video summery at https://youtu.be/_PBZke-H2Ic

Category : Copper

Tags : Copper prices, Scrap metal prices, Copper scrap, Copper scrap price, Copper Wire Scrap


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About Benny Jebaraj

For the past three years I have been working for RecycleinME .To help our valued members of RecycleinME, I involved in researching the current market trend of various scrap materials.more info

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