China's scrap metal imports are sharply declining with uncertain prospects for the new regulations

 According to foreign news on May 20, domestic scrap metal importers expect that the uncertainty surrounding the implementation of the "six categories of scrap" to restrict imports policy from July 1 will affect future scrap metal imports.

From July 1, eight kinds of solid wastes, such as scrap iron and steel, scrap copper and scrap aluminum, will be transferred from the Catalogue of Solid Wastes Used as Raw Materials for Non-restricted Imports to the Catalogue of Solid Wastes Used as Raw Materials for Restricted Imports.

The application conditions and specific processing procedures for the "six categories of waste" import approval document are basically the same as those of the "Regulations on Environmental Protection Management of Solid Waste Restricting Import Class as Raw Material" currently implemented. It is reiterated that only enterprises actually engaged in processing and utilization can apply for it, and other enterprises can not be entrusted with import agency, and the solid waste import license can not be transferred.

Industry insiders said that in this way, importers must prove that they have the ability to process scrap metals before they can obtain import licenses.

As the world's largest consumer of metals, China imported 5.34 million tons of scrap metal in 2018, down by one third from 2017, which is related to increasing the types of solid waste banned, strengthening the supervision of solid waste and cracking down on smuggling of foreign waste.

According to the situation of copper scrap, China's import of copper scrap accounted for nearly 10% of the total copper consumption (13.05 million tons) in 2018.

Industry insiders believe that under the influence of the Sino-US trade war, Japan and Hong Kong, China, have replaced the United States as the two major suppliers of scrap copper last year, while the new regulations further affect imports and supplies.

"Imports of scrap copper in June and July will be affected at least in the short term, and it is unclear how the quota system works," an analyst at a consultancy said last week.

A domestic copper scrap importer expects imports to fall by 40-50% in May and June. The general manager said the uncertainty surrounding the new regulations on July 1 would make it difficult for importers to place orders for ships arriving in Hong Kong after June.

"The new policy implemented on July 1 is uncertain, so people are reluctant to place long orders now." In order to ensure adequate clearance time, the company has set the arrival time as June 5.

An entrepreneur in Zhejiang said his company had suspended imports, but could apply for import licences through existing copper plants or by building new ones.

Jiangxi Copper Industry also said last month that it would be "no problem" to obtain import license, which could fully certify the qualifications of copper refining enterprises.