Market awaits decision on China's discussion to resume scrap imports

China is likely to roll out a national standard on "recyclable steel raw materials by this year-end, according to sources. A conference titled "Renewable Iron and Steel Raw Materials" was held on 13 Oct'20 to discuss the classification, terms and definitions, SteelMint learned from a recently conducted webinar by Mysteel.

Sources expect that such a standard will help coordinate the usage of recyclable steel raw materials both in and outside China and guarantee the promotion of a healthy development of Chinese steel industry.

On 1st Jul'19, China's Ministry restricted imports of scrap with importers requiring proper permits. This was done in order to further standardize the management of solid waste imports, and to prevent, control and reduce environmental pollution.

Mr. Li Shubin, the executive vice president of CAMU said that the heavy-reliance on imported iron ore is a grave threat to China's steel industry eating large amounts of steel mills' profits. The expedited import and consumption of recyclable steel scraps will pave solid ground for the continuous healthy development of the steel industry.

China's scrap consumption & imports

In the year 2000, China was consuming around 100 mn t of steel per year, but this figure has soared to between 800 and 900 mn t. As a consequence, we do see China's steel scrap generation growing rapidly over the next decade, said Mr. Roper, GM of Shanghai Metals Market at the Bureau of International Recycling (BIR).

China's ferrous scrap imports has come down to 0.18 mn t in CY'19 compared to 2.32 mn t in CY'17, as per data maintained with SteelMint.

Thus the market participants are looking out for further announcements which may influence global scrap & iron ore prices to a great extent.