BDSV cites scrap generation decline as foremost industry concern

The Düsseldorf, Germany-based Bundesvereinigung Deutscher Stahlrecycling- und Entsorgungsunternehmen (BDSV) recapped ferrous scrap industry conditions in Germany as part of an Internet broadcast annual conference held on Thursday, Nov. 5.

In a written recap of economic conditions, the association comments, “The 10-year growth phase of the German economy already lost momentum in 2019. This year we have the corona pandemic and the measures to contain it, [which] plunged the German economy into by far the deepest recession in its post-war history.”

As a result, the BDSV says, the ferrous scrap sector was “hit hard by this crisis, both on the supply side and on the demand side.” Slowdowns in the auto industry and other manufacturing sectors, plus the contraction of demolition and dismantling work led to “a serious decline” in scrap generation in the spring. The subsequent rebound has not brought scrap flows to 2019 levels, says the association.

Half of BDSV surveyed companies “expect the scrap market to be at the level before the COVID-19 crisis only after 2021,” states the group. “In the coming year, a third of the companies surveyed expect a better business situation than this year,” the BDSV writes.

On the demand side, in the first nine months of 2020, steel output in Germany of 25.7 million metric tons was about 16 percent below the previous year’s level, according to BDSV. “The foundry industry will remain at a very low level in 2020,” adds the group. “In the first half of 2020, production fell by [about one-third] compared to the previous year. There were clear signs of a recovery in the third quarter.”

BDSV says it rates as a positive circular economy aspects of the European Commission’s Green Deal policy, “as the steel recycling industry is already an important link in the value chain and has long experience with the recycling of raw materials.”

The association also says two studies it helped produce in cooperation with the Munich-based Fraunhofer Society are “an important basis” for charting the future of steelmaking in Germany. “Approaches to the decarbonization of flat steel production envisage that instead of the integrated route as is common today, a mixture of high-quality steel scrap and sponge iron will be used” via the electric arc furnace (EAF) method in the future.

BDSV also is working with the Aachen, Germany-based Fraunhofer Institute for Laser Technology (ILT) on research into how recyclers and manufacturers can work together to develop a more automated dismantling platform for end-of-life vehicles (ELVs). “The project application is currently running, the funding amounts to 12 million euros ($14.2 million),” according to BDSV.