World Scrambles to Feed China’s Appetite for Metal

About once a month, Ying Guangwu tucks some cash inside his black shirt, slings a knapsack over his back, and hits the road.

The square-jawed 33-year-old doesn’t always know where he’s headed or when he’ll return. But he knows exactly what he’s looking for: tons of scrap metal.

A pen-shaped magnet in his pocket helps him determine the quality of some metals. In December, Ying spent two weeks in Guangdong province, a 20-hour bus ride away, rummaging through factory warehouses and scrap yards. He bought 10 tons of tin ingots, lead cables and imported scrap, shipping them by truck to his wife, Lin Li. She sorted the stuff inside their two-story home before reselling it to metal traders and recyclers in town.

Ying and Lin, high school graduates, earned about $25,000 last year -- more than what many Chinese doctors and lawyers make.

“I didn’t want to do this when I was young. It seemed stupid to me,” says the second-generation scrap collector, whose sunburned face bears the mark of 10 years on China’s dusty streets. But his father took the right path, Ying says. “This is turning trash into treasure.”

China’s voracious appetite for metals is convulsing the world. It has led to economic booms in some nations and crime waves in others by so-called urban miners who steal metals from houses and public buildings. China’s runaway economy needs the metals to build railroads, office towers, cars and appliances.

The Middle Kingdom is now the world’s biggest consumer of copper, lead, zinc, iron ore, steel and aluminum.

China’s hunger has boosted mineral-rich nations, from copper-laden Chile to Australia, which has vast iron deposits. Prices of new and used lead, copper, nickel and other metals have tripled or more in the last few years, triggering a worldwide scramble for the commodities.

Chinese state-owned mining companies are prowling the planet for fresh supplies, while armies of people such as Ying and Lin spend their days hunting for castaway metals from typewriter letterheads to 30-foot-long aluminum missile casings.

Nowhere in China is the craving for metals more evident than Yongkang. This landlocked city in southeastern China’s Zhejiang province calls itself the hardware capital. With a population of about 530,000, Yongkang boasts about 10,000 hardware businesses, nearly all of them private family enterprises.

Yongkang is legendary for itinerant tinkerers who mended pots and pans for a living. Today, countless homes, storefronts, junkyards and factories carry on that tradition, buying, selling and recycling more than 600,000 tons of scrap metal every year. The city’s streets teem with tractors, trucks and bicycles hauling metal rods, coils and sheets.

Many head for Yongkang’s scrap-metal market, an outdoor bazaar slightly smaller than the Los Angeles Convention Center. More than 400 garage-sized storefronts are filled with scrap collected around the world: crushed beer cans from Japan, fuel pumps and used car parts from the West, air-conditioning condensers from northeastern China.

On a recent afternoon, Ying Sufang sat stooped outside Store No. 287, meticulously separating printers’ lead pieces no bigger than grains of rice.

The lead was shipped to her by her husband, who was foraging for scrap about 1,000 miles away -- not far from the Vietnam border. Last year, Ying and her husband earned more than $7,000, their best take in 10 years.

“That’s not bad,” the 44-year-old said.

But it has come at a price. Ying, who is unrelated to Ying Guangwu, grumbles about the grimy, sometimes punishing work.

She has never become accustomed to her husband being away for long stretches. He has been gone for the last month, leaving her and their middle-school daughter at home.

“I chose this business because 60% to 70% of people in our village are doing this,” she said. “This is how we make money.... I don’t know what else to do.”

Across the Pacific, George Adams is also cashing in on one of the greatest commodity booms in modern times. He is the president of Adams Steel, a scrap metal dealer in Anaheim that shreds used cars, washing machines and dryers down to the size of a wallet. The crushed metal is loaded onto trucks and containers that are shipped to traders around the world. Much of it winds up in China, in the hands of millions of scrap traders like those in Yongkang.

Adams’ annual sales now exceed $100 million. Last year he bought scrap yards in Southern California, installed more shredding equipment and added 70 employees to boost his workforce to 500.

He has a lot of competition. Thieves have ripped apart ballpark fences in Des Moines and stripped copper from cathedral domes in Cleveland. In Buenos Aires, people have made away with bronze plaques on boulevards and copper wires from utility companies. And in England, India and Malaysia, tens of thousands of manhole covers have vanished.

“They’re taking copper out of brand-new houses in Southern California,” says Carl Clark, Adams Steel’s plant manager. Such stolen copper pipes and wires don’t need to be recycled; they are bundled together and sold to brokers who send them all over the world, where they fetch triple the prices of a few years ago.

“An actual copper penny today is worth more as scrap than its face value,” Clark says.

The crime spree has resulted in deaths as people have fallen down manholes, and has caused such concern that countries like Argentina placed restrictions on the export of scrap metals.

The price of iron ore, a major ingredient in steel, jumped 71% in the last year alone, sharply cutting steel producers’ margins. But with China accounting for one-fourth of the world’s steel production last year -- and half of all iron ore imports -- Beijing is demanding that iron ore exporters put a lid on prices.

“The Chinese are flexing their market power,” says Ruth Stroppiana, an economist at Moody’s economy.com in Sydney, Australia. “The China factor,” she adds, “has been absolutely huge” for Australia, Brazil, Chile and other resource-rich nations.

Chinese towns such as Yongkang also have benefited, although the metal boom has taken a heavy toll on China’s environment and workers. Pollution-spewing metal factories have tainted rivers and land.

In Yongkang, officials have shut down dozens of the 1,000-plus smelters in the city, say plant managers. Authorities also have toughened rules governing imported scrap metals -- prohibiting car motors containing oil, for example, says Du Huanzheng, a metals expert at Zhejiang Institute of Industry and Commerce.

Still, China’s imports of scrap metal surged nearly 30% last year, Du says, and the trend is not likely to abate soon, least of all in Yongkang.

Ying Zhiang’s family has been in the scrap metal business for several generations. He is no relation to Ying Guangwu or to Ying Sufang. About 20 years ago, Ying collected scrap as he traveled the country fixing scales for merchants. “Even though products can get old and useless, the metal in them still has value,” he says.

Now 52, Ying runs Yongya Copper Industrial Co., one of China’s leading copper producers and recyclers. His Yongkang-based company ships 100 tons of the metal a day. He buys most of his scrap copper from dealers in town and the nearby port city of Taizhou, which is also known as Linhai.

In Yongya’s warehouse, workers in red caps moved bales of scrap wire, and others in street clothes picked up small bits of loose copper on the ground. Ying says he is considering collecting scrap himself again, because prices have soared beyond belief. A decade ago, he was buying a metric ton of copper in China for about $625. Now it costs about 10 times that amount.

“The numbers are out of this world,” he says.