BIR CONVENTION: Ferrous Demand Ebbing

Reduced demand in several scrap-consuming nations has led to slowly falling ferrous scrap prices in much of the world, according to several speakers who addressed attendees of the Bureau of International Recycling (BIR) spring convention, held in late May in Oslo.

A European Union report from Anton Van Genuchten of TSR GmbH & Co. in Germany predicted that the scrap price decline of April and May would continue into June because of “almost non-existent” demand from Turkey; the resumption of scrap supply from Eastern European seaports to Western European markets; and a reduction in orders from Asia, notably China.

Sun Jiansheng of the China Association of Metal Scrap Utilization noted that his country’s steel output increased by 18% in the first quarter of this year and that the total increase in production during 2003 as a whole could reach 27 million metric tons. “As a result,” he told delegates in Oslo, “there will be an additional 4.66 million metric tons of steel scrap needed for steelmaking.” But the speaker expected China’s domestic scrap resources to grow by 4.6 million metric tons this year.

A more upbeat report from came from Colin Iles and Mark Priestman of European Metal Recycling in the U.K. This year had brought a resumption of EAF steelmaking production at Alphasteel in Wales and of melting activities at Sheerness, U.K., through new company Thamesteel. There was also an expectation of a return to melting at a mill in Cardiff, Wales, under the CELSA brand name.

Scrap dealers throughout the world will be keeping an eye on Eastern Europe, where the strength of the steelmaking lobby in both Russia and the Ukraine seems likely to ensure a continuation of those two countries’ scrap export tariffs.

According to Denis Ilatovsky of Mair Joint Stock Co. in Russia, “no major changes” are anticipated to the duty in the Ukraine, which has helped to reduce the country’s scrap exports from 710,000 metric tons in the first quarter of 2002 to 203,000 metric tons in the corresponding period this year. In Russia, even though export restrictions pertaining to other industrial products have been lifted, Ilatovsky says the power of domestic steelmakers should help ensure that existing scrap measures remained in place.

The BIR Shredder Committee featured an update from Tony Bird of the UK-based Bird Group of Companies on the End-of-Life Vehicle directive. He noted that only six EU member states had implemented this legislation while “less than a third” had introduced free-of-charge disposal for the car’s final owner.