Aceros Arequipa uses sustainability funding for scrap access

Peruvian steelmaker taps into Spanish bank’s sustainability funding program.

aceros arequipa steel
Aceros Arequipa calls it “essential” to have a strategic plan to procure scrap for its steel mill.
Photo courtesy of Aceros Arequipa

Aceros Arequipa, a scrap-fed electric arc furnace (EAF) steel producer based in Peru, says it has signed a $40 million “sustainable alliance” with Spain-based Banco Bilbao Vizcaya Argentaria S.A. (BBVA) to promote the circular economy in Peru.

The steelmaker says banking firm BBVA has granted its first green import financing line for the steel sector to Aceros Arequipa. “This new sustainable line will be used for the elimination and reuse of [scrap] steel that will be transformed into new steel products,” Aceros Arequipa states.

The metals producer says steel is “certified as a sustainable construction material by the International Green Construction Code and the United States Green Building Council, being one of the most used components in the construction, infrastructure and transportation sectors.”

“Sustainability is a priority on the agenda at all levels of Aceros Arequipa, and along these lines we seek to be at the forefront of good practices, always considering the current needs of society and the planet,” says Tulio Silgado, general manager of the company. “This alliance is key to contributing to our circular economy approach, with 100 percent recyclable products and with a positive impact on the environment.”

Paul Bedón, a corporate banker at BBVA Peru, says, “At BBVA, we are committed to advising our clients on integrating sustainability into their business model. Through this new alliance with Aceros Arequipa, we will promote the manufacture of steel products based on recycled [scrap], and we will reduce the environmental footprint of the steel sector in the country.”

Aceros Arequipa says it is essential to have a strategic plan to procure scrap for its steel mill. To that end, in 2021 the company acquired two scrap recycling facilities in Florida, including one with an auto shredding plant.

The steelmaker has consumed more than 7.6 million tons of scrap since 2012 and says the financing will allow it to remain an active participant in the value chain of recycling ferrous scrap in the country.

The alliance between BBVA and Aceros Arequipa can be directly tied to three United Nations Sustainable Development Goals (SDGs), according to the steelmaker: SDG 3, health and well-being; SDG 11, sustainable cities and communities; and SDG 12, responsible production and consumption.

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