Yvonne Yue Li

Wed, May 14, 2025, 8:23 AM5 min read

(Bloomberg) -- A mountain of scrap metal in Salt Lake City that had been growing in recent weeks is finally set to shrink, thanks to the temporary truce in the trade dispute between the US and China.

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The 300,000 pounds of copper salvaged from old air conditioners, razed buildings and rusty cars has been piling up in the yard at Utah Metal Works Inc. after US shipments to China ground to a halt during the tit-for-tat tariff battle. Now that both countries have agreed to lower their levies for the next three months, the race is on to get the waste metal moving again.

US dealers like Mark Lewon, Utah Metal’s president, and their Chinese counterparts have taken to the phone to seal sales and eventual shipments.

“The biggest thing now is to move material, and then see where things are in 90 days,” Lewon said.

The disruption in the scrap copper world is a snapshot of the wider of chaos across industries unleashed by US President Donald Trump’s trade war, and it shows how supply-chain issues sparked by sweeping tariffs can’t simply be turned off like a light switch. The current pact between China and the US is for a three-month détente while a broader deal is discussed. Trump has said tariffs could go higher again if the countries fail to reach an agreement.

Some of the scrap copper inventory imbalance likely will start to unwind, but analysts are warning it will take some time.

That means there are questions over when both sides will see relief. US scrap yards have been forced to sell metal at record discounts. In China, the repercussions were equally serious as the country’s processors — historically the biggest buyers of US shipments — scrambled for enough raw material.

There is still skepticism over whether the truce will lead to a lasting deal, said Darrell Fletcher, managing director of commodities at Bannockburn Capital Markets. a subsidiary of First Financial Bank, adding “90 days doesn’t exactly change capital expenditure planning or commodity rerouting.”

Copper is viewed as a barometer of the world economy because of its heavy industrial use. Scrap plays a big part of that, accounting for about a third of global supply, especially as mined ore is increasingly coming up short. The metal is a key component for electrification equipment and electric vehicles, which has sent demand higher as prices in the futures market hit record highs in the past 12 months.