The international markets were quietened to a certain extent in February by the Chinese New Year holiday period; even though trading resumed well before the end of the month, the majority of manufacturers in [b]China[/b] did not return to operation before the start of March.

However, it has been contended that Chinese buying interest and inquiry levels were higher than normal during the New Year holidays - perhaps because purchasers are anticipating a rising market or because demand is actually showing real signs of improvement. Indeed, March reportedly began with a fresh round of buying activity among Asian consumers.

Other key factors to have influenced trading in recent weeks include the strengthening of the US dollar in relation to several other currencies, including the Euro and also the Rand. Exporters in [b]South Africa[/b] have confirmed that this exchange rate movement has improved their overseas sales prospects to some extent. Furthermore, trade has continued to be affected by the low availability of scrap in key regions of the world such as [b]Germany[/b], where a blanket of snow has covered many scrap yards and impaired vehicle movements. With higher quality scrap attracting particularly good demand, German traders are reporting that significantly more volume could be sold if it could be sourced in the first place.

In the [b]USA[/b], severe winter weather and price drops have served to undermine the flow of non-ferrous scrap into merchants’ facilities while strong competition for material is putting pressure on their margins. Also in America, container shipping lines are imposing ever-higher rates while widespread problems are reported with securing bookings and with equipment availability.

Shipping issues remain a preoccupation in many other parts of the world too. In [b]Australasia[/b], for example, problems with booking vessel space have been exacerbated by the fruit-picking season because shipment of perishable goods takes priority over scrap metal exports, resulting in lead times for containers of up to four weeks. At the same time, shipping lines are pushing for ever-higher ocean freight rates

In [b]India[/b], major congestion has occurred at ICDs owing to clearance delays for those importers who failed to obtain their new Ministry of Environment and Forests registrations ahead of the January 31 deadline. India has been a major buyer of aluminium and lead scrap from the [b]Middle East[/b], although China’s purchases of copper scrap from the same region have declined in recent weeks owing to the aforementioned holiday period.

Moving west into Europe, there is a reasonable availability of copper scrap in [b]Italy[/b] but competition for material is strong. Brass scrap is scarce and is attracting a healthy level of interest from traders in Asia. Prices paid by Italian consumers of common brass scrap are not reflecting the real value of the metals that make up the alloy, it is argued. And in what is described as a ‘sparkling’ secondary aluminium market, leading consumers are working at full capacity in response to fresh orders as well as availability of scrap at low prices. Leading dealers are said to be selling all of their production within the EU given the unattractiveness of wider export markets.

In the [b]UK[/b], aluminium secondary ingots have continued to bridge the gap to scrap prices, with the former rising more than £100 per tonne during February while the latter remained steady for most of the month. Meanwhile, stainless steel grade prices have increased in response to a combination of higher LME nickel values, increasing nickel premiums, higher chrome prices and signs of strengthening demand.

In [b]Russia[/b], concerns have been raised over the system of licensing which allows companies to operate only in a certain region. Firms wanting to operate in a different part of the country must obtain another licence for that particular area - a process which can take up to 12 months to complete.

Acknowledgement

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