Resource Recycling Magazine: Copper recycling market expected to improve

## Copper recycling market expected to improve

_By Jerry Powell, Resource Recycling_

Several analysts suggest that recycling markets for recovered red metal will slowly improve. These analysts took part in a commodity session this week in Chicago sponsored by the Institute of Scrap Recycling Industries.

The copper market and how the metal's value is determined have changed drastically over the past few years. Marc Gascon of LaFarga Group in Spain notes, "China now determines consumption but the commodity exchanges determine the price." LaFarga produces 200,000 tons per year of copper products.

In a similar vein, Matt Levine of Leonard Levine Metals pointed put how current markets are affected by the recent substantial growth in copper trading. "Electronic trading on the commodity exchanges increases price risk in copper," he noted. He told the audience that "the best way to mitigate risk in this is market is to quickly buy and sell, and don't try to analyze the price."

Jason Schenker of Prestige Economics offered an optimistic copper market assessment. "I am bullish on copper for 2013 and beyond," he stated. However, in terms of the current copper market, he was slightly less optimistic. "Demand dynamics have been affected by concern about eurozone growth."

As well, he explained that "the dollar's strength has dampened the copper price ... and the dollar is posed for another slide." He also pointed out that a number of supply constraints currently exist.

While he offered some caution, Schenker feels that copper market conditions will improve. "The global economy is expanding at a modest pace," he says. Schenker sees global GDP to be up 3.5 percent next year, versus 3.0 percent for 2012. Chinese GDP growth will rise from 8.0 percent to 8.4 percent, and this should help push scrap prices up.

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URL: http://resource-recycling.com/node/3093