Plans of Exchange-based Scrap Metal Exports Trading Put on Hold

SEATTLE (Scrap Monster):  The Russian authorities announced indefinite postponement to the plans to put trading of scrap metal for exports on to an exchange, mainly due to market uncertainties on account of the Covid-19 pandemic. As per earlier plans, traders would have been able to export only those ferrous and non-ferrous scrap that have been purchased through an exchange, effective April this year.

According to market sources, the decision is unlikely to be implemented any time soon because the government officials who have been actively supporting the change have been eliminated by the recent government reshuffle. Moreover, the pandemic has redefined the government’s priorities. As of now, scrap trading has been pushed to the bottom of the priority list. In addition, the authorities fear that move to limit exports may significantly impact commodity revenues.

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The exchange-based scrap metal exports trading would have made Russian scrap more expensive, due to the fees associated with the change.

The reform requires amendment of several legislative laws, before it can be finally implemented. It may likely remain halted until strong recovery in scrap demand in major steel producing and consuming countries, especially in Turkey- the primary scrap export destination.