Maersk Line stops handling scrap cargoes destined for China, Hong Kong
Maersk Line, the world’s biggest shipping line by cargo capacity, will stop handling scrap cargoes destined for mainland China and Hong Kong due to policy uncertainties, it said on Friday July 17.
The notice issued to Maersk’s clients on July 17 and seen by Fastmarkets said that any scrap cargoes, including non-ferrous and ferrous metal scrap as well as textile and waste paper, scheduled to depart on or later than September 1 will not be accepted.
The notice cited Maersk’s concerns to comply with China’s policy objective to ban scrap imports by the end of 2020.
"[Maersk] know [scrap shipments to China] are banned from December 31 so they don’t want to have any shipments arriving close to the date. Maersk brought the ban forward for their own safety,” one of the shipping company’s clients told Fastmarkets.
Maersk Line provides services at 36 ports of mainland China and Hong Kong, making it a leader in the country’s shipping sector, Fastmarkets understands.
“They are massive. We use their services 70-80% of the time,” a Southeast Asia-based scrap trader said.
Maersk’s announcement is in line with some other shipping lines’ actions, which daunted metal scrap traders with plans to sell copper and aluminium scrap to clients that could secure import quotas in the second half of the year, sources said.
China’s plan to trade copper and aluminium scrap metal as renewable material from July has been delayed, with details such as customs codes and inspection procedures for these newly defined products yet to be finalized and purchasing through import quotas currently the only legit means to get scrap metal into the country.
So far in 2020, China has allowed importers to buy up to 718,500 tonnes of copper scrap from abroad.
Fastmarkets assessed the discount for 94-96% copper scrap, birch/cliff at 23-24.50 cents per lb on June 29, widening downward by 0.5 cents from 23.50-24.50 cents per lb on May 22 and at its lowest since October 2016.