Key takeaways
- Tie non-ferrous prices to a public index (such as LME for copper, aluminium and nickel) with a fixed percentage or discount.
- Define each grade in writing, with photos, and the rule for downgrades.
- Specify weighing: certified scales, tickets per lift, tolerance and dispute process.
- Cap or remove container rental, transport and admin fees, or net them transparently.
- Audit every invoice: grade, weight, index date, percentage, deductions.
The pricing formula
A transparent formula looks like: price per tonne = index average for the reference period x agreed percentage (or minus a fixed discount) minus defined deductions. Each part must be in the contract.
Grades and downgrades
Write grade definitions with photos and agree that any downgrade is documented with photos and weights before invoicing. Without this, downgrades are invisible until you audit.
Run a competitive tender
- Package streams by grade and expected monthly tonnage.
- Ask at least three authorized buyers to quote the same formula.
- Compare net revenue after fees, not headline percentage.
- Agree a review clause every 6 or 12 months.
Audit every invoice
- Index value and date match the contract.
- Percentage matches the grade.
- Weights match scale tickets.
- Deductions are documented.
- Fees match the price schedule.
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FAQ
What is a fair percentage of LME for copper scrap?
It depends on grade, volume, location and logistics. Benchmark with several authorized buyers using the same formula rather than relying on a single quote.
Should we sell on spot or on contract?
Contracts with index-linked pricing give transparency and regularity; spot sales can make sense for one-off decommissioning lots.