Six months of rapid growth, five days of a sharp decline: No one wants to take over scrapped mobile phones.

Tens of thousands of mobile phones are densely arranged from the eastern corner to the western corner, piling up more than one meter high on the ground. These electronic wastes, which were forgotten in the drawers and shoeboxes of the general public half a year ago, now form a thick wall of mobile phones in the warehouse.

This is the achievement of Zhang Lei, a recycler, in the past few days. He spent more than 5 million yuan on these mobile phones, thinking he could make a small profit, after all, the market was really promising.

Since last September, the recycling of waste mobile phones has been on a rapid rise. In mid-March this year, along with the price increase in the terminal mobile phone market due to the soaring chip prices, the market for waste mobile phones reached its peak. Data from the Digital Recycling Network shows that the daily processing volume of mobile phones soared from 200,000 in September 2025 to nearly 1.5 million in March 2026, more than seven times the previous level.

However, starting from March 27th, the price quickly entered a downward channel. Within just five days, the overall recycling price dropped by more than 30%, and the prices of some models were even halved, with no sign of stopping the decline. Starting from April 1st, many recyclers in Shenzhen Huaqiangbei, the electronics distribution center, suspended purchasing.

His mood fluctuated with the market. Finally, Zhang Lei decided to close the warehouse - no longer purchasing or selling goods. "I won't sell anymore. If I do, I'll lose more than 1 million yuan."

Not only Zhang Lei, but Tech Planet learned that many recyclers also chose to close their warehouses. The great price fluctuations and the bottom line of not bearing losses made them choose to stay put. From last September to March this year, in just over half a year, the waste mobile phone recycling industry went through a cycle that other industries might take ten years to experience. No one knows how it will end, but many people believe that as long as they persevere, they will eventually wait for the day when the prices rise.

01

The number of mobile phone recyclers soared from 100,000 to 1 million

After working continuously for 12 hours, Hao Tian, a waste mobile phone recycler, finally ended his day's work. He recycled 400 discarded mobile phones and made a net profit of 5,000 yuan. This was the day when Hao Tian earned the most since the waste mobile phone recycling industry witnessed an epic market last year.

He sat in front of the computer almost all day, having no time to wash his face or brush his teeth. Then he quickly ate some takeout and drank two bottles of Red Bull. He was extremely tired but also extremely excited throughout the day.

In early March, the market for waste mobile phones was getting better day by day. For models with larger memory, such as the OPPO A93 (8GB + 256GB), the price rose from more than 100 yuan to about 300 yuan, a nearly two-fold increase. As the market improved, more and more people came to inquire.

Hao Tian received more than 200 inquiries in a day. Their purpose was very simple: to enter the industry. This seemingly threshold - free business became a money - making tool in everyone's eyes. "In March, the entire industry was like being injected with stimulants. People stopped selling new phones, dealing with second - hand phones, and doing repairs. Even barbers and fruit sellers joined the army of waste collectors," a second - hand mobile phone recycler complained on a social platform.

"To put it this way, there were probably only 100,000 people in the industry last year, but this year, it must be over 1 million," said Zhao Li, a senior recycler.

Recyclers have come up with various ways to promote the "trade - in" program. Here, waste mobile phones can be exchanged for all kinds of things - Lenovo printers, four - piece sets for spring outings, Phoenix brand bicycles, double - person silk quilts, cooking iron pots, and kettles. They hope to attract more customers in this way.

The large number of recyclers soon created a historical peak in the industry. Data from the Digital Recycling Network shows that the daily online processing volume was only 200,000 in September 2025, rose to 350,000 in November, exceeded 400,000 in January 2026, and was approaching 1.5 million in March.

As a result, some recyclers even couldn't afford to buy more goods with available cash. Hao Tian once faced a shortage of funds and had to borrow money from his friends for turnover. But the next day, when his friend transferred the money to him, he immediately regained his fighting spirit.

Almost every link was in full swing. After front - line recyclers collect waste mobile phones, they will sell them to large - scale recyclers in Shenzhen Huaqiangbei. These recyclers will then sell the phones to disassembly factories after inspection. Finally, the chips or solution providers will buy them, and then these chips will be reinstalled in consumer electronic products and sold to consumers.

In order to handle millions of orders every day, a disassembly factory started to operate in two shifts. However, the factory owner dared not expand on a large scale because no one knew when the upward curve would end.

The same was true for chip recyclers. A recycler told Tech Planet that more than once, he finished collecting goods at 12 o'clock at night. "I'm working 25 hours a day now." In just 10 days, he received goods worth 12 million yuan, almost reaching the storage limit. The piled - up goods were both wealth and anxiety. Because the prices changed every day, if he didn't sell the goods early, he might end up with losses.

But there were still too many goods.

02

Overstocking and sharp price drops, with some models dropping by 60%

In mid - March, only a few large recyclers in Shenzhen Huaqiangbei stopped recycling. But by the end of March, more and more recyclers stopped purchasing, and even some stalls were closed. A front - line recycler said that he called his original upstream partners, but no one answered for several days.

"The volume of goods flowing to Shenzhen is much larger than last year," said Zhao Li. Some people said that the quality inspection at the Digital Recycling Network now even requires a 20 - day wait.

"It's not just a few - fold increase, at least ten - fold," said a recycler in Huaqiangbei. Even, their daily work was filled with unpacking and inspecting phones, leaving no time to pack and sell the goods. As a result, the goods piled up more and more, leading to overstocking.

Obviously, many people misjudged the market.

According to data from the China Association of Resources Recycling, China produces an average of 600 million to 700 million waste mobile phones every year. Among them, about 200 million to 300 million enter the recycling channels every year.

Data from the China Circular Economy Association shows that after mobile phones are discarded, 54.2% are left idle by consumers, and only about 5% can enter professional waste mobile phone recycling platforms or formal recycling channels such as "trade - in" programs.

Due to the rising chip prices, these waste mobile phones that were originally sold by weight suddenly became more valuable, which made many people realize that waste mobile phones could be sold for money. When a large number of discarded mobile phones flooded the market, the existing industrial chain configuration was completely unable to handle the influx of phones.

Therefore, overstocking became a common problem for recyclers, disassembly factories, and chip manufacturers. "The market demand is only so large, but a large amount of goods are being sent to the market. For example, the market needs 10 million old mobile phones every day, but 30 million are being sent to the market every day. As a boss, one definitely has to lower the price, and in the short term, there is not much room for price increases," Zhao Li added.

When the balance between supply and demand was disrupted, the price curve no longer went up.

"A couple of weeks ago, a discarded phone that could originally be sold for 300 yuan can now only be sold for a little over 100 yuan, and those that were originally sold for over 100 yuan are now only worth a few dozen yuan. The average price drop is 50% or more," Zhao Li told Tech Planet, giving examples such as the Honor X9 dropping from 320 yuan to 130 yuan and the Redmi 9A dropping from 260 yuan to 150 yuan.

What's even more troublesome is the resulting chain reaction. In addition to the market, chip recyclers have the greatest say in the waste mobile phone market. But on April 1st, more than one second - hand chip recycler and waste mobile phone dealer said that they had stopped purchasing unless at extremely low prices.

A recycler finally decided to sell his goods. The reason was that he couldn't stand dreaming about buying and selling mobile phones every night. In the end, he lost 120,000 yuan on a 400,000 - yuan inventory. This loss wiped out all his profits since the beginning of this year.

Some recyclers couldn't wait and even drove to Huaqiangbei themselves to sell their goods at a price 15% lower than that of the Digital Recycling Network, just to get cash quickly. A recycler from Guangxi said that he had sold his goods four times this year. He earned more than 200,000 yuan in the first three sales. Because he made money, he bought more goods, and finally, he lost more than 600,000 yuan this year.

03

The last window period

However, there are still people who are persevering.

"This downward market has lasted for 20 days. In another 10 days, there should be a small - scale price increase," Hao Tian expressed his opinion. This is also the voice of many second - hand recyclers. They think that once the large - scale recyclers clear their inventories, the market can return to normal.

But the reality may not be so. The sharp rise in the price of waste mobile phones was due to the shortage of chips. A recycler of second - hand chips in Shenzhen said on a social platform that in March 2025, a disassembled second - hand LPDD 2GB chip only cost 15 yuan, a brand - new domestic one cost 20 yuan, and an imported one cost 40 yuan. The market was relatively healthy at that time. At that time, most of the customers who bought 90% of the second - hand chips were mainly engaged in the production of entry - level consumer electronic products, and these products were sold to Southeast Asia, Africa, Brazil and other regions due to their extreme cost - effectiveness.

Most of these second - hand chips were disassembled from set - top boxes. But later, due to the sharp price increase, the second - hand price rose to 40 yuan, making it unaffordable for entry - level consumer electronic product manufacturers. Then it rose to more than 80 yuan, and even white - label merchants couldn't afford it. In order to find lower prices, people set their sights on waste mobile phones.

However, when the second - hand chips disassembled from waste mobile phones exceed the consumption capacity of low - end consumer electronic product manufacturers, the market will further shrink. Because almost no brand is willing to lose credibility by using second - hand chips. Without customers, the value of the piled - up waste mobile phones will be greatly reduced.

However, many corporate executives, including Lu Weibing, the president of Xiaomi Group, have repeatedly emphasized that 2025 - 2027 will be three years of continuous increase in memory costs, and the new production capacity may not be available until the end of 2027.

This also means that everyone in the entire chain must sell their goods within just one year. Moreover, the market may not be as Hao Tian thought, because more than one large - scale recycler said that the pressure to clear the inventory was still very high. "A factory can use tens of thousands of chips every day, but millions are flowing in," a chip recycler said.

It still takes time to squeeze out all the bubbles. When the market returns to the real supply - demand relationship, the real competition for recyclers is just beginning.

(Note: All names in the article are aliases.)

This article is from the WeChat official account "Tech Planet" (ID: tech618), written by Wang Lin and published by 36Kr with authorization.