Recently, a UK client approached us at HK Dayo, interested in purchasing 5 tons of scrap copper from China. He had seen prices on Alibaba ranging from $3,000 to $10,000 per ton, while the international copper price hovered around $10,000. Given his past experience of being scammed in Europe, he was understandably cautious and sought our help to verify the legitimacy of these offers.
Background: Why Import Scrap Copper from China?
Our client explained that in the UK, they import scrap copper and refine it into copper blocks, which consumes less energy compared to processing raw materials. Before coming to China, he had identified ten suppliers on Alibaba, all quoting around $4,000 per ton. We helped him narrow down his options to two suppliers in Shandong, northern China, and accompanied him on factory visits.
On-Site Factory Audit Experience
Factory 1:
- Condition: The first factory was merely a decrepit warehouse, raising immediate red flags about its reliability.
Factory 2:
- Condition: The second factory appeared more legitimate, engaging in other metal businesses and boasting professional equipment. Initially quoted at $4,500 per ton, we managed to negotiate a 10% discount easily, which seemed suspiciously effortless.
- Claims: The manager claimed they sourced high-purity scrap copper through special channels, only sold to foreigners, and only accepted payment in dollars. They showed brand-new samples and used testing equipment to confirm a 99% copper content.
Inspection Results:
- Testing: Despite the high-tech testing showing 99% copper purity, a simple magnet test revealed the presence of iron. When requested to cut open the wires, the factory refused, but visible copper-coated iron wires confirmed our suspicions of a scam.
Confirmation of Low-Priced Scrap Copper Scams
After this experience, we confirmed that all low-priced scrap copper offers from China are scams. Even though our client wanted to try higher-priced factories, the requirement of a deposit before inspection was a consistent and concerning pattern. Our colleague investigated local copper prices and confirmed that China’s copper prices align closely with international rates due to imports from countries like Australia, Japan, and South Korea.
Lessons Learned
Advice for Importers:
- Avoid Low-Priced Offers: If a deal seems too good to be true, it probably is. Scammers often take deposits without delivering the promised goods or send extremely low-purity copper.
- Verify Thoroughly: Even if initial factory visits and sample checks seem satisfactory, always perform additional tests like the magnet test.
- Legal Action: Pursuing international lawsuits is time-consuming and costly. It’s better to avoid risky transactions in the first place.
Don’t be greedy and believe in low prices, so you won’t be deceived
Conclusion
In summary, beware of low-priced scrap copper offers from China. They are typically scams designed to exploit inexperienced buyers. At HK Dayo, we aim to protect our clients from such frauds by providing thorough verification and reliable sourcing services.
Follow up Our Blog: To stay updated on more insights and real-life case studies, subscribe to our blog. At HK Dayo, we share practical tips and experiences from our years of dealing with various Chinese suppliers across a wide range of products.
Contact us for reliable sourcing solutions and to ensure you don’t fall victim to scams.
