Economic Observer reporter Wang Yajie

One day in early July, in a sorting workshop of a recycled copper industrial park in Yingtan, Jiangxi, workers were feeding waste copper from a conveyor belt into a spectral sorting equipment. Zhou Huan, the person in charge of the operation of the park, is communicating to modify the declaration form for technical transformation subsidies, the application document for super long term special treasury bond discount, and the special subsidy document for green manufacturing, and is preparing to submit it to the local development and reform department on the same day.

On June 30, 2026, with the approval of the State Council, the National Development and Reform Commission issued the "15th Five Year Plan for the Development of Circular Economy" (hereinafter referred to as the "Plan"), which was officially released to the public on July 3. The Plan proposes to improve the high-value utilization level of traditional "urban minerals" such as scrapped motor vehicles, waste electrical and electronic products, waste steel, waste non-ferrous metals, waste plastics, and waste textiles.

After the policy was implemented, various links in the industrial chain began to respond.

Traditional recycled copper distribution centers such as Yingtan in Jiangxi and Qingyuan in Guangdong have gradually stopped receiving goods, closed stores and ceased operations at a number of small recycling points on the streets; The compliant recycled copper industry park is accelerating production expansion, and traditional air conditioning copper pipe factories are increasing the proportion of recycled copper feeding.

In the laboratory of lithium battery copper foil enterprises, high-purity recycled copper samples are undergoing testing, but the procurement department still maintains the purchase of primary copper.

Old Players Leave

Chen Jianjun has been engaged in scrap copper recycling business in Yingtan, Jiangxi for nearly ten years. In early July, he put away the sign at the entrance of the store that said "high priced recycling of copper, aluminum, and wires". In his words, "This sign has been hanging for several years, and this time it's taken off

He stated that after the release of relevant regulations, the industry's requirements for environmental protection and compliant operations have further increased. Some small and medium-sized recycling entities have faced increased operational pressure due to difficulties in quickly adapting to new standards and bearing the cost of compliance transformation. In addition, due to recent market fluctuations, based on current market prices, recycling one ton of scrap copper often results in a loss of two to three hundred yuan.

Due to this dual impact, since July, he has changed his previous business model, no longer hoarding inventory, and achieving same day collection and sale to reduce the risk of losses. And around his store, three smaller scrap copper recycling points have closed down one after another due to the pressure of operation.

In the Yingtan Recycled Copper Industrial Park, which is more than ten kilometers away from Chen Jianjun's store, Zhou Huan, the park operation manager who is verifying the relevant application materials, told the Economic Observer reporter: "There were not so many policies that could be applied for at the same time in the past." The park where he is located completed the construction of a digital system in 2025, and added three spectral sorting devices in the first half of 2026, all of which are on the threshold of the new policy.

Since July, the amount of scrap copper entering the factory in the park has increased. Zhou Huan stated that this increase mainly comes from two channels: first, the implementation of designated supply agreements signed by local home appliance dismantling and scrapped motor vehicle enterprises; second, small recycling points on the street are unable to stock up, and the goods received on the same day are sold at a discount to the park.

But he said, "The concentration of goods is a gradual process, not a sudden influx. How long individual investors can hold on also depends on the trend of copper prices and their own financial pressure, which are still dynamically changing

The digestion speed of the new policy varies among recycling entities of different scales. A medium-sized scrap copper trader is still observing in Shangrao, which is over 100 kilometers away from Yingtan. The person in charge stated that they did not immediately stop collecting, but they did not dare to increase the procurement volume. They will take a look first and wait for the declaration details to become clearer before making further decisions.

Traditional copper processing plants are gradually experiencing sporadic changes in their supply structure. Li Guohua, the procurement director of an air conditioning copper pipe factory in Jiangxi, said that the average proportion of recycled copper in the whole factory had increased to 55% in July, and the production line of some low-voltage cables had reached 65%. The proportion was around 45% in the first two years, gradually increasing in the first half of this year, and further raised in July.

I used to want to add more recycled copper, but the supply was unstable and the impurities fluctuated greatly, so the production line dared not increase the quantity, "said Li Guohua." Now, the recycled copper rods produced in the compliance park have complete traceability records and testing reports for each batch, and the quality is controllable, so the production line dares to improve. "He said that compliant recycled copper rods are 1200-1500 yuan cheaper per ton than native copper rods, and with the addition of green manufacturing procurement subsidies, the comprehensive cost reduction per ton is 1400-1700 yuan. The above calculation does not deduct the additional cost of impurity removal and environmentally friendly processing of recycled copper, and the actual comprehensive price difference fluctuates with copper prices.

Li Guohua said, "Without this round of policy dividends, we would not be able to withstand the high copper prices during this off-season

The adjustment pace varies among different factories. Li Guohua said that the reason that leading enterprises like them can quickly increase the proportion of recycled copper feeding is that they have a large purchase volume, stable long-term orders, and the right to negotiate prices. Small and medium-sized cable plants are not so fast. They have a small purchase volume, and can not get a long order price. Some are more inclined to purchase low-cost recycled copper to reduce costs in the off-season.

In the industrial park where Zhou Huan is located, a two shift production line has started to operate continuously. The quarterly long orders for downstream air conditioning copper pipes and low-voltage cable companies have been scheduled until mid August. Two small earthen smelting plants with an annual output of less than 10000 tons in the surrounding area have suspended production, and one of them plans to transfer the equipment in the near future.

Chen Jianjun is still hesitating about what to do next. He is considering attaching himself to a local industrial park and turning it into a collection point. However, most compliance parks have not yet opened channels for retail collection and hanging, and there are access requirements in terms of ledger, warehousing, environmental protection facilities, etc. He is still unsure about whether the industrial park will accept it or how much money can be earned by collecting it on behalf of others, "he said." If you do it alone, there isn't much space left. Let's inquire first

Recycled copper and other materials "enter the door"

Zhang Yuan, the person in charge of the technical department of a leading domestic recycled copper enterprise, has sent out samples for a week, but no customer has responded to their intention to purchase in bulk.

The sample sent by Zhang Yuan is the first 4N high-purity recycled copper sample sent out by the company on a "mass production level" scale. Single batch of 300 to 500 kilograms, accompanied by a complete set of impurity detection reports and batch traceability data. Prior to this, 4N high-purity recycled copper was only subjected to internal testing.

After the "Plan" listed the deep impurity removal of scrap copper and high-purity recycling smelting as special subsidy directions, the top recycling copper enterprises mentioned above decided to send samples.

Without subsidies, this production line with a cost of over 100 million yuan will not land this year, "said Zhang Yuan

Liu Wei, the person in charge of the procurement department of a lithium copper foil enterprise in East China, confirmed that his laboratory has received 4N high-purity samples from three recycled copper enterprises. The test results show that the single point purity can reach 99.99%, and the paper data meets the standard.

But Liu Wei said that the problem is not with single point purity, but with batch stability. Native cathode copper comes from stable mines. Taking LMEA grade cathode copper as an example, single harmful impurities are generally controlled at around 3ppm (parts per million). Recycled copper raw materials come from waste cables, old household appliances, and industrial miscellaneous copper. Even after deep impurity removal, trace impurity fluctuations between batches still exist. The laboratory measured that the fluctuation range of impurities is 3-8ppm. The numerical difference may seem small, but during high-speed rolling of ultra-thin copper foils of 4.5 microns and 6 microns, any fluctuation in impurities can lead to wire breakage, pinholes, and thickness deviation.

Liu Wei further stated that a production line can run 40-50 tons per day, and once there is a problem, it faces the risk of scrapping the entire batch. Although the copper dissolution process is equipped with multi-level purification of electrolyte and online impurity monitoring, which can partially alleviate trace fluctuations, enterprises are still unwilling to take risks in mass production (note: electrolyte purification can only remove dissolved metal impurities, and cannot eliminate batch fluctuations caused by native solid small impurities in raw materials). In order to save one or two thousand yuan per ton and bear the risk, this account is not cost-effective. The factory where he works still purchases 100% primary cathode copper for all mass production lines. The procurement plan for the second half of the year has been scheduled, and there is no reserved bulk purchase quota for recycled copper.

He said, "No one in the procurement department dares to sign and release recycled copper raw materials. Who is responsible for any problems

However, rejecting does not mean not touching at all. In the second half of the year, the above-mentioned lithium copper foil enterprises will continue to receive samples from recycled copper enterprises for technical tracking and database accumulation, but only at the laboratory stage. As for batch feeding, we haven't reached that node yet. In fact, top domestic copper foil companies have already used 3N recycled copper in bulk in low-end energy storage copper foil products, and only 4N high-purity recycled copper has not yet entered the mass production stage of 4.5/6 micron ultra-thin copper foil for power batteries. In the "Plan", the phrase "gradually exploring demonstration applications in the fields of new energy and power equipment" is understood as a long-term technological breakthrough orientation, not a short-term cost reduction plan.

A person from another computing power server heat dissipation copper material company also made a similar judgment. He said that AI (artificial intelligence) computing devices have even higher requirements for the conductivity and consistency of copper materials than power batteries. Customers only recognize the testing reports of native copper, and the traceability system of recycled copper cannot be explained to customers yet. However, he also admitted that recycled copper rods are widely used in the low-end radiator field, and the bottleneck is mainly in the ultra-thin thermal conductive copper strip of high-end servers.

The recycled copper companies that send samples are also aware of these bottlenecks.

Zhang Yuan said that he didn't expect to receive the order for the first batch of samples, but the policy provided direction, and the subsidy diluted the equipment investment cost, so we can make it first.

Capital Living Water

After receiving the policy document in early July, Zhao Yonggang began to recalculate the accounts. The integrated industrial park project for recycled copper that he is responsible for was put on hold last year, with a total investment of over 300 million yuan. The loan term for ordinary operating working capital is 3-5 years. When there is no interest subsidy for long-term loans in the project, the repayment pressure is concentrated in the first three years, with high annual interest rates and significant cash flow pressure.

After the Plan included the recycled copper industrial park integrated with recovery, sorting and high-purity smelting into the scope of super long term special treasury bond discount interest, he recalculated the account. For example, the comprehensive financing cost of long-term project loans applying for supporting discount interest decreased by nearly 2 percentage points (note: the discount interest cycle is usually 2-3 years, not the whole loan cycle). Preliminary calculations suggest that the static payback period may be shortened. Now the project is restarted, the land leveling is completed, and the application materials for interest subsidies will be officially submitted in the third quarter.

An industrial investment institution focused on the circular economy track is conducting intensive research on recycled copper projects in Jiangxi, Anhui, and Hubei provinces.

A person from the investment institution said that he had not made a move for a period of time before, and the core issue was that the return cycle was too long and the funds were not matched. Now there is a policy channel for long-term funding issues, and projects have shifted from high-risk to researchable targets. They plan to advance two transactions, invest in a medium-sized recycled copper smelting enterprise, and jointly build an integrated park in central China with local urban investment.

The threshold screened out another group of people.

A small homemade smelting plant with an annual output of less than 10000 tons originally planned to add a new production line, but decided to put it on hold in early July. A staff member of the factory said: "There are scale and compliance thresholds for the declaration of technological transformation subsidies, which are beyond our reach, and even more so for the treasury bond discount. The cost of getting goods in the upstream compliance park is several hundred yuan a ton lower than us, and downstream customers are pushing down prices, squeezing both sides." Two similar enterprises around have stopped production and are looking for buyers. He has also considered transferring himself, but the market is not good, the equipment discount is severe, and there are not many people taking over the deal.

Zhao Yonggang saw an opportunity.

His platform started synchronously promoting three integrations in July, acquiring county-level recycling sites, participating in medium-sized smelters, and locking in supply agreements for scrap and dismantling enterprises.

In Zhao Yonggang's view, small and medium-sized enterprises lack funds and policy channels, and his team has a cost difference, which is the integration space. He predicts that in 2026, the recycled copper industry may usher in a 2-3 year window of integration and mergers and acquisitions. Whoever receives the money first and completes the integration first will occupy a better position.

However, the above-mentioned investors remind that there are many projects applying for treasury bond discount interest at present, and the amount of final approval and the speed of capital arrival are still uncertain, which need careful consideration.

(At the request of the interviewee, Liu Wei is a pseudonym in the article)

(Author Wang Yajie)