The most-actively traded March-delivery Comex copper contract settled at $4.2945 per lb on Tuesday February 24, up by 12.41% from $3.8205 per lb the previous week.
“Such [a] high Comex [price] will curtail business at one point, as receivables become too expensive,” a scrap seller source said, adding that he knows of some people “who are sitting on four to six loads of copper thinking the Comex will go even higher.”
Interestingly, discounts for most copper scrap grades did not change much despite the Comex gain, similar to what was seen last week.
Despite the “incredible Comex” gain, a scrap trader said he wasn't seeing much change in discounts “as one would anticipate.”
One reason could be the continuing impact of last week’s extreme weather across sections of the US, which resulted in power outages in Texas and halted transportation in many areas.
A second scrap seller said he knew of two scrap chopping lines that were down last week due to the inclement weather in Texas.
“It is a ridiculous market,” a brass ingot maker said, referring to the jump in Comex copper prices.
A second brass ingot maker noted that at the current Comex copper price level, it is very difficult for him to make a profit.
“I just don't know what to do with the Comex so high; I just don't have enough margin for this price,” the second ingot maker said. “We are not selling the ingot high enough, and we do not have much business right now.”
The Comex price increased by more than 50 cents per lb in just one week, or “almost a dime a day,” a third brass ingot maker said. “We are very busy, and haven’t faced major problems because of the winter storm.”
Fastmarkets assessed the copper scrap No2 copper, discount, buying price, delivered to brass ingot makers, at 55-58 cents per lb on Wednesday, up by 14.14% from last week’s range of 47-52 cents per lb.
The light copper discount was assessed at 60-63 cents per lb on February 24, up by 14.95% from 52-55 cents per lb the previous week.
All other copper scrap discounts were unchanged week on week.
Brass scrap prices soared alongside the Comex boost this week.
Fastmarkets assessed the copper scrap No1 comp solids, buying price, delivered to brass ingot makers (commonly called red brass) at $2.74-2.78 per lb on Wednesday, up by 6.36% from $2.57-2.62 per lb one week earlier.
The buying price for copper scrap comp borings, turnings rose by 6.51% to $2.68-2.72 per lb from $2.52-2.55 per lb in the same comparison.
Radiators were assessed at $2.17-2.20 per lb on Wednesday, up by 2.82% from $2.10-2.15 per lb last week.
The yellow brass solids price was assessed at $2.22-2.24 per lb, up by 1.59% from $2.17-2.22 per lb in the same comparison.
The United States' copper scrap market has been thrown out of balance since the price for the red metal surged above the $4 per lb on Comex this week.