Chinese demand for high-quality zorba, a nonferrous auto shred, has remained robust through the summer and going into the fall, exporters told AMM.
Prices have been steady the past two weeks, although shippers said tags could rise as automakers in China and Japan ramp up fall production schedules.
Most exporters pegged prices for material with a 94- to 95-percent metallic content at between 77 and 80 cents per pound, unchanged from Aug. 29, and material with a 90- to 92-percent metallic content is steady at around 74 to 75 cents per pound.
China’s push for zorba could continue for the foreseeable future, largely because the generation of obsolete scrap has yet to gain firm footing in China. "They are just starting to bring shredders online," one exporter said, noting that the amount of end-of-life scrap generated in China is much lower than in the United States. "It’s a temporary cultural divide. They just don’t have 100 years worth of material sitting around waiting to be shredded."
Additionally, the flow of zorba could improve as exporters gain a better understanding of the ramifications of China’s "Operation Green Fence," which was implemented in March to reduce imports of banned substances into the country. With news that "Green Fence" likely will be a permanent initiative (amm.com, Sept. 5), shippers said that they will continue to adjust to the new regulations and inspection procedures.
"Over the past six months, exporters have adjusted to ‘Green Fence’ and have learned how to handle it," a second shipper said, explaining that he had made arrangements to sell low-grade material to domestic consumers on a recovery basis instead of sending it to China.
"Anything over 90-percent metallic is very desirable in China right now," a third exporter said. "The stuff over the 95-percent range is really in demand. The aluminum smelters need the material; it just has to make it into the country first. Zorba will become more valuable as the lower grades become less and less available."
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