Germany’s ferrous scrap recycling association, the BDSV, says the Chinese government’s additional restrictions on scrap imports starting in mid-2019 “are another step in the so-called ‘National Sword’ program, with which China is approaching the target of no more imported scrap into the country from 2020 onward.”
The BDSV has told its members that China’s Ministry of Ecology and Environment, Customs Administration and other authorities “have recently announced in a joint statement that as of July 1, 2019, import restrictions will be extended to ferrous, copper and aluminum scrap. These [forms of] scrap [face] no special export restrictions in Germany, since they are resource-saving and can be used instead of primary raw materials.”
Surveying the current landscape of Germany’s ferrous scrap export picture, the BDSV comments, “At present, 15 percent of German ferrous scrap exports (about 8.5 million metric tons annually) are delivered to countries outside the EU-28, with the share of German ferrous scrap exports to China at 33,000 metric tons in 2017, or about 0.4 percent.”
While that volume is small, the BDSV adds, “Nevertheless, the BDSV assumes there will be dislocations in the international markets, which will also be felt in Germany. For the quantities of steel scrap that China imports each year (2.3 million metric tons in 2017), new sales markets need to be tapped. This inevitably generates price pressure. The situation is aggravated by increasing protectionism in other countries, as well as indirectly by United States tariffs on steel,” states the group.