SteelMint is organizing 4th Steel Scrap, Billet & DRI Summit in Bangkok, Thailand from 27-29 Aug’19. The conference aims to understand the current ferrous scrap trade flows and ongoing price & demand-supply dynamics.
The 2nd day of the conference began today with opening remarks from Mr. Davinder Chugh – Senior Partner, Synergy Capital
He said currently, 70% of the world’s steel production is through BF-BOF route. However, the growth in global scrap usage for steelmaking have picked up in the last 5 years, as scrap consumption growth stood at 5% in CAGR 2014-2018, as against 2% CAGR 2008-2018.
China has shown considerable growth in scrap usage over the last 3-5 years as the consumption increased by around 100 MnT from 87 MnT of scrap consumption in 2014 to 187 MnT in 2018.
The growth has been on the back of increased scrap usage by BOF steelmakers, as well as growth in new EAF route steel mills which now account of 121 MnT out of the total (928 MnT) of production in 2018.
Historically, the increase in a country’s GDP has directly led to increase in scrap generation from the recycling of steel products. Thus it is expected that the global scrap availability will increase to 1 Billion MT by 2030 and 1.3 Billion MT by 2015, while, China’s Scrap availability is projected to be even faster to 300 MnT and 500 MnT by 2030 and 2050 respectively.
There is a possibility that this may lead to surplus scrap in China and may urge govt to decrease duty on scrap exports in the future. However, with increasing EAF share as well as scrap consumption in the country, it is likely that China would be consuming most of the scrap it generates domestically, till at least the next decade.
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