Steelmakers Demand Quota System for Ferrous Scrap Exports

SEATTLE (Scrap Monster): The trade association representing Russian steel pipemakers urged the government to reinstate quota system to limit ferrous scrap exports out of the country.

In a letter addressed to the Maxim Reshetnikov, Russia’s Minister for Economy, the Russian Foundation for Development of Tube Industry (FRTP) called for reinstating quota system for scrap exports to countries outside the Eurasian Economic Union (EEU) for a period of six months. The quota must not exceed 995,000t, it said. The proposal is currently under consideration of Russia’s Ministry of Economic Development, sources said.

The quota system, implemented for the first time in September last year, had resulted in notable decline in ferrous scrap exports from the country. In fact, the yearly exports had dipped to 10-year lows. As a result, the country could ensure flow of scrap to domestic market.

The implementation of a similar quota system would be helpful for the scrap industry, if implemented during the second half of the year, during which the scrap collection are expected to remain muted.

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According to FRTP, scrap collections witnessed a dip of around 2 million tonnes in April-May this year. The domestic ferrous scrap collections are predicted to decline by nearly 4 million tonnes in 2020 compared with the previous year.