Chinese requirements for stainless steel scrap could increase five-fold over the coming decade, Michael Wright of ELG Haniel’s U.K. office told attendees of the Bureau of International Recycling (BIR) Stainless Steel & Special Alloys Round-Table in Milan.
Asia could be producing more than 30 million metric tons of stainless steel by 2015, making up between 60 and 65 percent of total world production, Wright commented. Over the same period, China is likely to increase its crude stainless output from 2.8 million metric tons per year to more than 14 million metric tons, with the country’s stainless scrap requirement rising from around 900,000 metric each year to 4.5 million metric tons.
At such a level, China would be consuming more than 25 percent of the world’s stainless scrap, and it would need to import more than 1.5 million metric tons each year by 2015.
Having observed that “China’s product mix with regard to qualities is not yet stable,” Wright speculated that the proportion of CrMn grades would remain relatively high while “the ratio of austenitic qualities might remain steady and the difficult ferritic grades could well be the losers.”
“CrMn and CrMnCu grades are really poisonous when they enter the recycling loop,” said Wright. “Detection by magnet or conventional methods is very difficult. Unless we find an efficient technique of separation at source, the scrap reserve will be severely contaminated. This contamination will create major problems for stainless recyclers and melters alike.”
Heinz Pariser, owner of HHP Alloy Metals & Steel Market Research and Publications in Germany, predicted that Asia would account for around two-thirds of global stainless steel consumption by 2015. He also pointed out that, without the estimated 34 percent increase in Chinese production during 2005, “The whole stainless steel industry would have declined 10 percent.. For 2006, Pariser anticipated an improvement in world stainless production of at least 6 percent.
Barry Hunter of Hunter-BenMet Associates, New York, posited that the U.S. consuming markets would eventually find themselves competing for scrap supplies “down to basically truck-load quantities.” He added, “Our major international scrap wholesalers, while servicing both domestic and international markets, will also be competing for committed supplies against each other and the Asian brokers. Accumulating scrap for bulk cargoes for a single large [shipment] will be difficult to justify.”
In his report on the European market, BIR Stainless Steel & Special Alloys Committee Chairman Sandro Giuliani of Giuliani Metalli/Cronimet Group in Italy said global stainless steel production was expected to be nearly 10 percent lower in the second half of 2005 than in the same period last year and 4.5 percent lower for the year as a whole. It was “surprising,” he said, that most of the production cutbacks had been implemented in Europe where consolidation and major investments had been expected to guarantee production increases.
Ildar Neverov of Russia-based TeplotovResource informed delegates in Milan that his country exported about 200,000 metric tons of stainless steel scrap in the first eight months of this year. Finland has been receiving some 52 percent of Russia’s exports while a further 23 percent has been going to The Netherlands.
The stainless session concluded with a prediction from Stuart Freilich of Universal Metal Corp., Worcester, Mass., that demand for titanium and super alloys would remain strong “for many years to come,” notwithstanding “the usual price fluctuations.”