Posted on 23 Apr 2021
Since fully reopening the door to steel scrap imports on January 1, China’s steel scrap imports soared to 55,389 tonnes over January-March, way above 3,366 tonnes for the first quarter of 2020 and more than doubled from around 27,000 tonnes for whole 2020, Mysteel Global noted from the latest detailed data released by China’s General Administration of Customs (CACC).
The dominant majority was imported in March, which accounted for 45,564 tonnes, the CACC data showed, and the significant increase in China’s Q1 scrap imports was within market expectations, as many Chinese steel mills and scrap traders have been actively exploiting import channels or establishing business relationships with overseas suppliers, market sources shared.
“In the first two months after the resumption of (steel scrap) imports, we chose to stay on the sidelines, as we had no idea how strict the new quality standard and inspections would be, and we were reluctant to take the risk of being rejected by the Customs,” an official from a steel mill in North China’s Hebei province shared.
However, “we have got in touch with overseas scrap suppliers and maintained the communication, and after noting that some bookings have been successfully declared at the Customs, we have imported our first shipment in March and got it cleared towards the end of March,” he added, disclosing some more shipments will arrive at China’s ports over April-May.
An official from a steel mill in East China noted the enthusiasm among the Chinese steel mills in looking for possible overseas scrap supplies, though his company has not been among the many yet.
“Everyone knows that imported scrap will probably be just to complement domestic supplies, but it is better to have an option than not, and they’d also like to have first-hand experience in Customs clearance to be ready for future serious imports when necessary,” he added, agreeing that the first-quarter scrap imports by the China was by no means cheap as global steel scrap prices have been strengthening since July-August 2020.
In the coming months, China’s scrap imports may increase further, as Beijing would like to increase steel output by electric arc furnaces to over 15% of the country’s total or 20% at the best, and scrap use in steelmaking to 30%, both by 2025, and imported scrap will assist the domestic steel mills in achieving such targets, the domestic market sources shared.
Source:Mysteel Global
