Scrap copper prices have an impact on the economy and the copper mining industry. About half of the copper used in the US each year is derived from recycled copper alloy scrap. It’s used to make ingots and other charge metal to be used in furnaces. Smelters also depend on the scrap from cast plumbing products and radiators from automobiles. The recycling of scrap copper impacts the availability and price of many types of equipment in use every day and helps keep copper prices down.
The copper mining industry is directly impacted by scrap copper prices. When there is a lot of scrap copper available at low prices there’s less need to mine copper. This can lead to the idling of mines and laying off or furloughing workers. This can affect the economies of cities, counties, states and entire regions. It means less money to spend on quality of life issues. Many people in mining regions depend directly or indirectly on the mine for their livelihood. When the mine is slow so is their income.
The environment is also impacted by the price of scrap copper. Copper mining harms the environment. When scrap copper prices are low and supply is plentiful there is less need to dig up the ground in search of copper ore. That means less damage is done to the soil, few trees are cut down and less pollutants are released into the air and water. The result is healthier people and communities. People often don’t make this connection and look on copper recyclers as scavengers who do not contribute anything of worth to society. However the environmental impact of scrap metal can be significant.
The change in the materials used in radiators has had a significant effect on the amount of copper available for recycling. This in turn has caused the scrap copper prices to rise. This has impacted the price of many products which require copper in their manufacture. The rise in the cost of the copper they need is reflected in the increased prices of those products. As the automotive industry continue to evolve and move towards lighter synthetic products there will be less copper parts to be recycled. This will cause an increase in the need to mine for copper.
The products used for plumbing have changed significantly also. New lead-free plumbing materials and that industry’s increasing use of synthetic materials has also made a difference in the amount of scrap copper that is available. Copper is still important in plumbing but because of its high price the industry is continuing to look for alternatives. This has had a serious impact on the amount of copper available for recycling and by extension the price of recycled copper. The ability to collect and recycle copper can help to hold down the price to some degree.
In the U.S. the struggle is to gain and maintain self-sufficiently in the handling of their need for copper. It is a simple case of copper’s consumption versus production. Scrap copper helps to balance the equation. For example U.S. copper mines were unable to produce all the copper needed for the American economy in 1995. Mining produced over 2,000 tons short of what was needed. Scrape copper producers were able to make up most of the difference. Ultimately scrap coppers accounted for almost 45% of the copper used that year. In fact over recycled scrap has supplied almost 50% of the copper used in the past 20 years.
In the United States about half the copper used each year is recycled copper. That recycled copper itself is divided between new manufacturing scrap and old post consumer scrap copper. Smelters prefer old scrap copper even though scrap copper prices are almost as high as that of newly mined copper. This process is driven by scrap copper’s intrinsic value. It is low velocity material and it has a product life which can range from 10 years to over 100 years. Manufacturers favor old scrap copper over new scrap copper. This is evident because the use of new scrap has vacillated between 61% and 54%.
Scrap copper prices and use has increased a great deal. In fact the use of scrap copper for allows has increased by 50% over the past two decades. Almost 70% of scrap copper was processed directly by foundries, brass mills, ingot producers and wire rod producers. Any dramatic rise or fall in scrap copper prices impacts how much of it is used. Brass mills accounts for much of this increased demand. The amount of scrap copper used for cast products hasn’t changed much for decades no matter what happens with scrap copper prices.
Changes in the nature of scrap copper has led to a change in demand for it. In the past foundries used a large percentage of the copper drawn from used radiators. Almost half of this recycled copper is used in plumbing products. This has helped hold down the cost of those plumbing products. Now that this important source of scrap copper has been largely eliminated it has forced scrap coppers smelters to search for new sources of this valuable resource. This process has helped both economically and environmentally. It had long eliminated huge amounts of scrap metal from landfills and other waste disposal areas.
The U.S. regulation on lead in the drinking water through the use of the 1991 EPA Lead and Copper Rule has given the US some of the most stringent drinking water laws in the world. It has also had an impact on price of scrap copper. The Lead and Copper Rule has led the plumbing supply companies to experiment with other material in an attempt to reduce or eliminate the use of copper pipes. But this has also led to the reduction in the amount of scrap copper that is available. The scrap copper market is changing rapidly. This has increased scrap copper prices a great deal. This is in turn impacts the price of products which use copper.