According to worldsteel’s presentation at the 12th China International
Metal Recycling Conference 2019, trend of EAF production is expected to
grow. Currently, EAF is the mainstream in Europe, North American, Middle
East, Southeast Asia and Africa. China still focuses on production by
using non-EAF facility. However, worldsteel pointed that China may
possibly push more EAF production and by 2035 the world EAF ratio would
reach a new historical high.
Steel-making production by using EAF facility has lower environmental
footprints. Compared to BF-converter furnace process, EAF using steel
scraps as main raw materials has largely reduced environmental
footprints. Moreover, it takes up smaller space with lower investment,
few processes and flexible production. However, producing long products
by using EAF lacks scale advantages with more difficulties in quality
control and higher costs.
The advanced countries are the main steel scrap exporting countries with
the US as the largest steel scrap exporting country, followed by UK and
Japan. The major steel scrap importing countries are Turkey, India and
Vietnam, which together accounted for one-third of the world steel scrap
import in 2017.
According to worldsteel, world steel scrap export is around 100 million
tonnes each year. The global steel scrap supply has been increasing
steadily and demand also continued to grow. Major sources of steel scrap
are from scrapped steel products. Worldsteel believed that there are
still sufficient steel scrap supplies in the world market and some of
the regions may even encounter oversupplies.
Changes in the global steel scrap supplies and consumption
Source: World Steel Association
China, in particular, is currently having sufficient domestic steel
scrap supplies and there might be a possibility of over supplies in the
future.
Forecast of domestic steel scrap supplies in China.
In the case of ASEAN, apparent steel demand in the ASEAN-6 countries
continued to increase significantly since 2009, except for 2017 when
steel consumption retreated mainly due to destocking activities in some
countries. On the other hand, domestic steel production in the region
did not show any significant increases until 2016 with the commencement
of the new capacities from companies such as Formosa Ha Tinh in
Vietnam.
Steel-making production is mainly done through scrap-based EAF
facilities. However, capacity utilization rate still remained low, at
below 50%. Despite this, scrap demand in the region continued to
increase with an average annual growth rate of 4-5% in the last 10
years. Scrap demand saw a significant increase of 26% y-o-y to 24
million tonnes in 2017. ASEAN-6 is not self-sufficient in scrap supply
and still needs to rely on import from other countries. Major sources of
import are USA, Japan and Australia.
Most of the six countries in ASEAN are net importers of scrap. Vietnam
is the region’s biggest scrap importer accounting for nearly half of
total volume of scrap import in the region, followed by Indonesia and
Thailand.
The countries in the region that are net exporters of scrap are
Philippines and Singapore However, volume of scrap export from
Philippines declined significantly in 2017, by 34% y-o-y. This could be
due to higher demand within the country. Singapore’s scrap export volume
has not been significant, with export volume declining in 2017.
Source: SEAISI |