BIR: China’s scrap generation to grow rapidly
China’s scrap generation is likely to grow rapidly, was the conclusion of the Bureau of International Recycling (BIR) Ferrous Division’s virtual meeting this week attended by Kallanish.
Shanghai Metals Market general manager Ian Roper suggested a scrap generation figure for China of over 350 million tonnes/year by 2030. “We are expecting obsolete scrap volumes to be growing 10 to 20 million tonnes a year,” he noted.
Alongside increasing generation, China is bringing online 60m t/y of new electric arc furnace capacity in the coming years.
Although China is expected to lift its scrap import ban next year, Roper insisted: “We are not anticipating steel scrap being allowed into China from early next year. We think that ultimately there will be a change – some kind of reclassification – but that is more likely to happen at the end of next year.”
The Ferrous Division’s Statistics Advisor, Rolf Willeke, said China’s steel scrap usage for crude steel production dropped to 93.75mt in the first half of this year from 101.13mt in H1 2019. However, scrap consumption was 25.7% higher on-quarter in the second quarter.
EU steel scrap exports slid -10.7% in H1 to 9.776mt and US overseas shipments fell -2.3% to 8.401mt, whereas Japan bucked the trend, seeing 38.2% growth to 4.884mt.
Zain Nathani of the Nathani Group of Companies said scrap demand would remain “…subdued” in India for the remainder of the year. Pakistan and Bangladesh have however been receiving regular bulk and containerised shipments from major exporters such as the US, UK and Japan.
Denis Reuter of Germany-based TSR Recycling noted that scrap prices had been generally stable in most European countries at the start of October, while Turkish mills had enjoyed some success in pushing prices lower.
Tom Knippel of SA Recycling said US scrap intake was now similar to pre-Covid-19 levels but mill capacity utilisation rates were down from around 82% in 2019 to below 70%.
Quintin Starkey of South Africa’s Metal Recyclers Association (MRA) said his country’s modified preferential pricing system for scrap is to remain in place until an export tax is introduced some time in 2021. The MRA was lobbying the government to adopt an ad valorem duty of 10% on ferrous scrap and 5% on non-ferrous scrap with a duty-free rebate system for metals not consumed locally and/or when supply exceeded demand.
Ferrous Division President Greg Schnitzer of US-based Schnitzer Steel Industries told viewers that everyone should be “…proud” of how the scrap sector had withstood some “…difficult” conditions in 2020. He added: “It’s nice to see worldwide demand for scrap and buyers we haven’t seen in years.” He is eyeing a “…strong finish” to 2020 carrying forward
into 2021.