Kazakhstan extends ferrous scrap export ban for 6 months

Kazakhstan's Ministry of Industry and Construction has announced an extension of the country's ban on ferrous scrap exports for an additional six months, starting from 22 August. This measure, aimed at supporting the domestic steelmaking sector, also includes a continuation of the ban on non-ferrous metal waste and scrap exports.

The extension of the ferrous scrap export ban is aimed at increasing capacity utilisation at mills facing a scrap shortage and addressing issues related to illegal scrap circulation, according to the ministry. In June, the Kazakh government announced plans to prolong the export restrictions on ferrous scrap.

Scrap restrictions

Kazakhstan collected about 1.9 million tonnes (mnt) of domestic ferrous scrap in calendar year 2023 (CY'23), while the total market demand reached 3.9 mnt. Despite the ban, which was initially introduced seven years ago to support local steelmaking, Kazakh scrap has still been exported to Russia. Recently, the ban has been extended to cover the Eurasian Economic Union (EAEU) members, including Russia.

From January-August 2023, Kazakhstan exported just 25,000 tonnes (t) of ferrous scrap, a significant drop from 125,000 t in the entirety of 2021 and the 1 mnt peak in 2019, according to recent government figures. Most of these shipments were directed to EAEU countries including Russia, Belarus, Armenia, and Kyrgyzstan, followed by China, Iran, and Pakistan.

In 2023, Russian imports of Kazakh scrap totaled 591,000 t. Additionally, Kyrgyzstan has also imposed a six-month ban on ferrous scrap exports outside the EAEU.

Export taxes

Additionally, Kazakh authorities are considering implementing a tax on the exports of sulphur, coal, ferroalloys, copper and iron ores, and concentrates. Meanwhile, Russia has set a scrap export quota of 600,000 t, which has been extended multiple times since its introduction at the beginning of 2023. Russia has warned that Kazakhstan's rail export restrictions on scrap could disrupt raw material supplies to steelmakers and might be reported to the EAEU as a trade barrier.