Copper Scrap Metal Market Report: September 2025
Market Overview
September 2025 delivered a moderately bullish performance for the US copper scrap metal market, with prices climbing steadily throughout the month despite broader economic uncertainties. The market demonstrated notable resilience as domestic supply constraints and Federal Reserve policy expectations provided crucial support to pricing. The most significant driver was China's surprise 4-5% decline in refined copper production, which removed approximately 500,000 tons from global annual supply calculations and created tightening conditions that benefited US scrap dealers and recyclers.
Price Trends & Analysis
US copper scrap prices experienced steady upward momentum in September 2025, with regional variations reflecting local supply-demand dynamics. Bare bright copper commanded premium pricing at $4.70-4.83 per pound across major US markets, while #1 copper wire and tubing traded between $4.52-4.73 per pound. The pricing structure reflected approximately 4 cents per pound increases from late August levels, representing roughly 1% monthly gains.
Regional pricing showed the West Coast maintaining the highest premiums, with bare bright copper reaching $4.83 per pound compared to $4.62 per pound in the Midwest. This 21-cent spread reflected logistical advantages and stronger local demand in western markets. COMEX copper futures climbed to $4.58 per pound by month-end, representing a 2.05% monthly increase and positioning prices 10.13% higher than September 2024 levels.
The US market benefited from unique inventory dynamics following earlier tariff-related stockpiling. COMEX warehouse inventories reached exceptional levels of 232,195 tons, the highest since 2004, creating a buffer that supported stable pricing despite global supply disruptions. This inventory buildup, initially driven by tariff avoidance strategies, provided US markets with unusual insulation from international supply shocks.
Key Market Drivers & News
Demand-Side Developments
The construction sector continued providing stable baseline demand throughout September, with infrastructure spending supporting steady scrap consumption. Electric vehicle production maintained its role as a critical growth driver, with US EV sales projected to reach 7 million units by 2025, up from current levels. Each battery electric vehicle requires approximately 60-80 kg of copper compared to just 24 kg in traditional combustion engines, creating substantial multiplicative demand effects as EV adoption accelerates.
Data center construction emerged as an increasingly important demand category, with artificial intelligence infrastructure driving unprecedented power requirements. A single large-scale data center consumes over 2,000 tons of copper during construction, with facilities requiring approximately 27 tons per megawatt of power capacity. North American data center infrastructure spending is projected to reach $70 billion by 2030, creating sustained demand for copper-intensive electrical systems and cooling infrastructure.
Power grid modernization continued gaining momentum, with US utilities responding to surging electricity demand projections. Grid investments are expected to require substantial copper inputs for transmission lines, transformers, and distribution systems as the country adapts to increased power loads from electrification and digitalization initiatives.
Supply-Side Constraints
Chinese production disruptions dominated supply-side developments in September. The 4-5% decline in Chinese refined copper output represented the first September production drop since 2016, removing critical supply during what should have been peak production season. Five major Chinese smelters underwent simultaneous maintenance while processing fees remained in negative territory, indicating persistent copper concentrate shortages.
US scrap copper supply faced mixed conditions. The domestic recycling sector processed an estimated 870,000 metric tons in 2024, up modestly from previous years, but September saw tightening availability as industrial activity levels remained robust. Scrap-fed smelter operating rates in China dropped to 59.9%, creating additional pressure on international scrap markets as Chinese buyers competed more aggressively for available material.
The removal of Chinese government subsidies for scrap copper recycling plants created additional supply chain disruptions. This policy change, part of Beijing's broader industrial capacity management efforts, reduced the competitiveness of Chinese scrap processors and altered global trade flows in ways that benefited US domestic markets.
Global Economic Factors
Federal Reserve policy expectations provided the most significant macroeconomic support for copper markets in September. Markets priced in a 93% probability of a 25 basis point rate cut at the September 17 meeting, with expectations for additional cuts through year-end. Lower interest rates reduce the opportunity cost of holding commodities while supporting economic activity that drives copper demand.
Dollar weakness amplified the positive policy effects. The Dollar Index declined 7% since January 2025, making copper more attractive to international buyers and reducing input costs for domestic manufacturers. This currency trend provided fundamental support for commodity pricing across the board.
The August resolution of US copper tariff uncertainties created additional market stability. The exclusion of refined copper from import tariffs while maintaining levies on semi-finished products resolved months of trade uncertainty that had disrupted normal market functioning. This policy clarity allowed market participants to make more confident inventory and procurement decisions.
COMEX warehouse dynamics reflected these policy impacts. The massive inventory buildup from pre-tariff stockpiling created unique conditions where US markets had abundant physical copper available even as global exchange inventories remained historically tight. LME copper stocks sat 40% below five-year averages, creating regional arbitrage opportunities that supported US pricing.
Future Outlook
The short-term outlook for US copper scrap markets appears cautiously optimistic through the fourth quarter of 2025. Industry forecasts project copper prices stabilizing between $4.70-4.95 per pound in October-November 2025, with potential for further gains if Chinese production constraints extend into early 2026.
Federal Reserve policy remains the critical near-term catalyst. The anticipated September rate cut could trigger broader commodity market strength, with analysts projecting copper could reach $5.00 per pound within six months of accommodative monetary policy implementation. Historical precedent from previous easing cycles suggests copper responds favorably to coordinated dollar weakness and lower interest rates.
Chinese production recovery represents the key supply-side variable to monitor. Production is expected to normalize by November 2025 as maintenance activities conclude, but any delays could extend current supply tightness and support higher pricing. The technical nature of current disruptions suggests recovery is likely, but the timing remains uncertain.
Seasonal demand patterns typically support copper markets in the fourth quarter as construction activity peaks and manufacturers build inventory ahead of potential winter disruptions. This seasonal strength could amplify the impact of current supply constraints, particularly if Chinese production recovery is delayed beyond expected timelines.
Electric vehicle adoption continues providing structural long-term support. US EV sales growth of 25% projected for 2025, combined with expanding charging infrastructure requirements, suggests sustained copper demand growth regardless of cyclical factors. Wood Mackenzie estimates the EV sector will need 250% more copper by 2030 just for charging stations, representing substantial incremental demand for US scrap markets.
For US scrappers and recycling yard owners, current conditions favor strategic inventory accumulation during any temporary price weakness. The combination of supply constraints, supportive monetary policy, and structural demand growth from electrification creates a favorable medium-term environment. Industrial businesses should consider forward contracting for fourth quarter and early 2026 needs, as the risk-reward profile currently favors securing supply at current price levels rather than waiting for potential declines that may not materialize given ongoing supply tightness.
Data center expansion and grid modernization provide additional tailwinds that should support scrap demand through 2026 and beyond. These infrastructure-intensive sectors offer sustained copper consumption that is less cyclical than traditional industrial demand, providing more stable market conditions for scrap metal participants.