Quiet, patchy, lacklustre, no real rhythm: these are all words and phrases being used to describe the domestic non-ferrous market. In short, the increase in LME prices has not produced more material.
On December 2, England emerged from its second national lockdown into a localized tier system whereby the severity of local restrictions is determined by infection rates in that area and by hospital capacity. The total number of deaths in the UK (within 28 days of testing positive for COVID-19) is now around 60,000 and total cases exceed 1.6 million.According toPrime Minister Boris Johnson, the imminent rollout of a vaccine signals that life could go back to “normal” by Easter next year. The UK is the first country to fully approve the Pfizer vaccine and inoculations will begin very shortly.
In November, Mr Johnson unveiled a 10-point plan for a green industrial revolution, insisting that his proposals would “create, support and protect hundreds of thousands of green jobs” while ensuring the UK made strides towards its net zero carbon target for 2050. New cars and vans powered wholly by petrol and diesel will not be sold in the UK from 2030; this is good news for the recycling sector as approximately 80 kg of copper is needed for an electric vehicle as compared to an average of 20 kg for a combustion engine. Mr Johnson has also pledged that the UK will produce enough offshore wind to power every home in the country, quadrupling production to 40 gigawatts by 2030 and supporting up to 60,000 jobs. Again, this is good news for our sector as 15 tonnes of copper is needed per megawatt of installed capacity.
There will be £100 billion of capital spending next year to ensure that the UK’s economic recovery from the impact of COVID-19 will be as swift as possible. The vision set out by Chancellor of the Exchequer Rishi Sunak is one in which investment in infrastructure is a key priority for delivering growth and creating jobs across the whole of the UK. It is assumed that there will be no tax increases until the UK moves out of recession and that, in the coming year, there will be no return to austerity or spending cuts.
At the time of writing in early December, a Brexit deal still has not been reached. The uncertainty is encouraging those non-ferrous merchants selling to mainland European consumers to reduce their stocks and ship before the December 31deadline. There is still demand from European consumers and discounts are unaltered.
Chinese buyers are offering good discounts in the UK. Now that material has started to arrive and be accepted in China, confidence is increasing. Hopefully, this will soon allay the fears of those shipping lines reluctant to transport material to China owing to the uncertainty caused by the country’s new import regulations. Changes are also being seen in the way merchants are handling and processing material; for example, wire-tie balers are being installed and used in preference to shredders.
Recycled Products Ltd (GBR), Board Member of the BIR Non-Ferrous Metals Division