The sharp plunge in iron ore prices has resulted in a shift in steel production from electric arc furnaces (EAFs) and induction furnaces (IFs) to blast furnaces, especially in China. The ramp-up in steel production by non-Chinese region has shifted the focus of steel scrap exporters to destinations such as India, Turkey and south Asian countries.
In many of these countries, the domestic scrap output is found insufficient to meet growing steel scrap demand by EAFs and IFs. Also, unlike China, these countries have recorded significant rise in steel production during the year.
For instance, India’s steel production has risen by 3.3% over the previous year to 75.1 million tonnes during the initial ten-month period of the year. This is at a time when global steel output dropped by almost 2.5%. Also Chinese production slumped by 2.2%. During the first eight months of the current year, India’s scrap imports have jumped higher by 18% to 4.187 mt. The fall in supply from domestic sources is likely to push imports of steel scrap by the country. Incidentally, the scrap consumption by the country is expected to double over the next ten-year period.
The imports of steel scrap by Bangladesh has witnessed dramatic rise in 2015. The imports are likely to grow at the fastest pace in 2016 also. The steel scrap consumption by EAFs and IFs in the country are projected to total around 3 million tonnes, almost five times the consumption levels witnessed in 2015. The favorable import duty structure in the country will boost more imports of scrap into the country.
The scrap imports by Pakistan too has picked up. According to 2014 data, South Korea is the largest importer of steel scrap in Asian region, followed by India. The region had accounted for almost 30% share of the global seaborne steel scrap trade during the year.
Meantime, Turkish steel scrap imports have dropped by almost 18% over the previous year to 12.04 million tonnes during the initial nine-month period of the year. The steel output by the country during this period has declined considerably. However, the new government order that requires all steel finished products made from billets imported from China to be exported within nine months has led to rise in demand for scrap by EAFs.
Contact: Baosen Steel
Add: No. 61 Haier Road Qingdao China1