ReMA Roundtables: Urgent Call for Transparency in Copper Scrap Sourcing

Increasing Demand for Transparency

As the U.S. expands its secondary copper smelting and refining capacities, transparency in sourcing scrap copper is becoming increasingly critical. This was a key takeaway from discussions at the Recycled Materials Association (ReMA) Roundtables held in Chicago this September.

Best Practices in Scrap Sourcing

Naveed Moghadam, the commercial director at Aurubis Richmond, emphasized the importance of sourcing from suppliers that adhere to best practices and have established procedures. “Who we source from matters,” he stated, reflecting the company’s commitment to responsible procurement as it gears up for operations at its new facility in Augusta, Georgia.

Growing Importance of Traceability

Aldo Jordan, founder and president of The Metals Agency, highlighted that recycled content traceability is becoming increasingly important. He noted that consumers will seek greater visibility into the scrap being processed. “The recycling supply chain will have to be more transparent and green our footprint,” he added.

Copper’s Critical Status

Last year, the U.S. Department of Energy classified copper as a critical raw material. However, the U.S. Geological Survey rejected the Copper Development Association’s request to include it on the U.S. Critical Minerals List, citing that U.S. imports predominantly come from reliable trade partners such as Chile, Canada, and Mexico.

Global Competition for Copper Supply

Jordan pointed out that copper’s compounded annual growth rate was 3.3 percent from 1950 to 2022, with projections suggesting it may double or triple over the next decade. He stressed that the competition for copper supply is increasingly global, which could positively impact the U.S. market, although China is likely to seek alternative sources.

Low Recycling Rates in the U.S.

Moghadam also highlighted the low recycling rates for copper-containing printed circuit boards (PCBs) in the U.S., which he estimated at 18 percent compared to 40 percent in the European Union. Aurubis Richmond aims to address this by sourcing a variety of scrap materials, including low-grade insulated copper wire and shredder heavies.

Plans for Future Operations

Once operational, Aurubis Richmond plans to begin acquiring end-of-life products with copper content ranging from 20 percent to 50 percent, with deliveries scheduled for later this year. The facility is set to start building its scrap inventory in the first quarter of next year, with processing expected to commence in the second quarter. The goal is to create a sustainable domestic market for scrap that currently ends up in Southeast Asia.

Suppliers Navigate Quality Challenges

Suppliers of copper scrap are becoming increasingly aware of quality standards, yet many remain hesitant to ship to China. Aldo Jordan pointed out that this hesitation stems from uncertainties regarding the country’s subjective quality requirements. He emphasized the need for clarity in these standards to facilitate smoother transactions.

No. 2 Copper Scrap: A Key Focus for Aurubis

Naveed Moghadam highlighted the importance of No. 2 copper scrap in Aurubis’ business strategy, particularly within Europe. He noted that European smelters tend to be more flexible than their Chinese counterparts, often willing to accept off-spec scrap packages, which provides a significant advantage for suppliers.

Demand for More Smelting Capacity in the U.S.

While recent investments in new copper smelting capacity in the U.S. are promising, Jordan stressed that significantly more capacity is required, especially for processing lower-grade scrap. He underscored that expanding this capacity is crucial to meet growing demands in the domestic market.