China's steel scrap conference outlines policy revision to boost scrap import

China's recent steel scrap conference held in Shandong Zibo outlined a strategic approach to boost the generation, import, and utilisation of ferrous scrap in steel production.

A notable outcome of the conference was the China National Standards Association's plan to seek a revision of import standards for recycled steel scrap resources in the near future.

Several key points emerged from the conference, emphasising the importance of these changes:

1. Imported scrap conditions: The import of steel scrap will be permitted under the condition that heavy, medium, and small steel scrap can be mixed and shipped alongside shredded scrap.
   
   
2. Length restrictions: Steel scrap exceeding a length of 1.5 metres will be allowed in quantities not exceeding 5% of the total imported scrap.
   
   
3. Impurity limits: Strict regulations regarding impurities were discussed to ensure the quality of imported steel scrap. The permissible impurity levels were defined as follows:
   • Bonus: Impurities should not exceed 1%.
     
     
   • Heavy, medium, and small scrap: Impurities should not exceed 1.5%.
     
     
   • Shreds: Impurities should not exceed 2%.
     
     
   
   
   
4. Copper content restriction: The conference emphasised that non-alloy steel scrap should not contain copper content exceeding 0.3%.
   
   

Additionally, it was highlighted that HMS (80:20), a common type of steel scrap, can be fully imported into China.
According to reports, it has been noted that the current standard threshold for inclusions in steel scrap is relatively high, with three levels set at no more than 0.3%, 0.8%, and 1%. However, it is observed that there is a limited number of varieties available in the international market that meet Chinese standards. Moreover, even those circulating widely often have higher inclusion content than what is permitted by Chinese standards.

The need to decarbonise China's steel sector, mainly reliant on BF-BOF due to large-scale unavailability of obsolete scrap, will see an increased scrap usage from levels of 260 mnt in 2022 to 320 mnt by 2025 and over 350 mnt by 2030, as per estimates by the China Association of Scrap Metal Utilisation (CAMU). Higher scrap generation and use by the world's largest steel producer will boost global consumption.

The focus on increasing the utilisation of scrap in the steel industry aligns with China's cornerstone policy, which aims to enhance self-sufficiency in iron ore production, secure mining rights in domestic and overseas markets, expedite mining operations, and promote both imports and domestic recycling of scrap. By prioritising these initiatives, China aims to bolster its steel sector while supporting sustainable resource management.