Firmer scrap prices to steer bullish market sentiments: BIR Mirror

SEATTLE (Scrap Monster): The Bureau of International Recycling (BIR) has published its latest Ferrous Metals World Mirror which forecasts that the bullish sentiment in global scrap market is likely to continue. The scrap prices are anticipated to remain relatively firm in the near term. The major scrap markets are likely to witness sideways to upward momentum.

In China, steel scrap consumption has recorded significant jump, following increased utilization of steel scrap by basic oxygen furnace operators. The government initiative to curb environmental pollution through stricter regulations has led to increased scrap use. The incentives announced by the administration will further promote processing facilities that consume scrap. Meantime, the ferrous scrap exports from China surged to 96,400 tonnes during the initial five-month period of 2017, despite imposition of hefty 40% duty on exports.

The ferrous scrap imports by India bottomed out, mainly on account of increased focus by companies on achieving compliance with the unified tax system. Although scrap imports rose in April, the combined imports during the first four months of the year recorded steep decline. As per data, the April imports by the country had totaled 419,789 tons, considerably higher by over 22% when matched with the prior month. The cumulative imports declined by 33.6% in Jan-Apr ’17 to total 1.712 million tons.

Meantime, the ramp up in steel production by Pakistan and Bangladesh has resulted in notable increase in imports of bulk scrap cargoes by these countries during recent months. The recent statistics released by Pakistan’s National Bureau of Statistics suggest that imports in May surged higher by 22.3% over the previous month to 476,854 tons. Incidentally, the country’s scrap imports had registered 24% in 2016.

The US scrap market is expected to remain buoyant, primarily on account of robust demand and healthy scrap flow conditions. The anticipated improvement in overseas export market coupled with global economic recovery is expected to result in steady and better scrap market conditions, the BIR Mirror noted.

The BIR report states that Turkey continued to remain as the world’s leading importer of steel scrap during the first quarter of 2017. The imports by the country totaled 4.26 million tonnes, rising marginally by nearly 3% over the previous year. South Korea with imports of 1.601 million tonnes, pushed India to third place. The scrap imports by India declined sharply by 39% to total 1.186 million tonnes during the first quarter of the year. Meantime, EU-28 region remained the world’s leading steel scrap exporter in Jan-Mar ’17. The exports totaled 5.053 million tonnes, rising by 31% when matched with the previous year.