EU Nonferrous Scrap Dealers Report Sharp Drop in Orders

During the annual general assembly of the Brussels-based European Metal Trade and Recycling Federation (Eurometrec), held March 15, 2012, attendees discussed some of the main issues affecting nonferrous scrap metal recyclers.

Eurometrec members are primarily involved in the collection, sorting, trading and processing of nonferrous scrap metal. The meeting, held in Brussels, included representatives from major national trade associations from all 27 EU member countries.

According to a statement by Eurometrec, discussions held during the event surrounded current market conditions. According to attendees, the sovereign debt crisis in the Euro-zone is continuing to have an adverse effect on the EU’s general economic well-being and the confidence of Europeans. In this uncertain environment in which many consumers are choosing to restrict their expenditure, there have also been negative consequences for the order books of an EU manufacturing sector already confronted by the issue of overcapacity.

As a result, the EU’s scrap collection and processing sector has witnessed a significant reduction in orders for its secondary raw materials from mills and foundries in the EU. Scrap metal prices have weakened as a consequence, which are working to provide a disincentive to collect and process scrap due to unattractive margins.

According to Eurometrec, the volume of manufacturing scrap available in the EU has declined significantly in light of production cutbacks triggered by reduced demand for finished products. At the same time, there has been no evidence of a shortage of obsolete scrap because of the efforts of recyclers to increase their collection rates.

Robert Voss, Eurometrec president, says, “There is concern among Eurometrec members, and the many companies they represent, that demand for our materials from our European consumers may be weakening, which is likely to reflect on the viability of those companies continuing to expand their operations and could have an adverse effect on investment in their infrastructures, which is so vital at this time.”

“The relationship between the thousands of companies represented by Eurometrec and the European smelters has always been a close one,” Voss continues, “and I hope that their demand will remain strong, encouraging our member companies to continue to increase the processing and recycling of our vital raw materials.”

Recent feedback from some secondary smelters in the EU confirms that pressures on the wider economy have rendered market conditions more difficult for metal producers. However, smelters have stressed that the availability of end-of-life scrap remains more than adequate. In its latest results package, one such company noted rising input volumes of scrap and described as “good” the supply of recycled materials, including in particular electronic scrap.

Other main topics covered included the implementation of the European Union’s Waste Directive by member states; the administrative and financial burdens imposed by nonferrous scrap shipment procedures within the EU; the slow progress made towards end-of-waste status for copper scrap; positive developments with respect to scrap and the EU’s REACh regulation, which covers the registration, evaluation, authorization and restriction of chemical substances; and the roadmap to a resource-efficient Europe.