05/12/2014 – BIR Autumn Round-Table: Ferrous recyclers call for free movement


There is “not much fun or profit” to be had in the ferrous scrap business presently, declared Christian Rubach of TSR Recycling in his final address as president of the BIR (Bureau of International Recycling) Ferrous Division during the Brussels-based association’s 2014 Autumn Round-Table Sessions. During his eight years in the position, Rubach noted that he had witnessed “everything you can have”—from the early “boom” years to the economic crisis of 2008/09 and then periods of stagnation punctuated by a good year in 2010, he told delegates in Paris Oct. 27.

In introducing the guest presentation of German Steel Federation President Hans Jürgen Kerkhoff, Rubach contended that the scrap and steel industries “sat more or less in the same boat” regarding the challenges they face. The guest speaker confirmed that, indeed, both sectors were battling the “bad behavior” of countries that sought to impose protectionist measures designed to benefit their domestic industries.

“For the steel and steel scrap markets, we have to rely on free movement,” Kerkhoff insisted.

He pointed out that the lower growth trend now being seen for the world steel industry might become “the new normal.” Arguing that surplus steelmaking capacity was increasingly becoming a point of focus, he reckoned that China’s overcapacity in 2014 could be as high as 280 million metric tons.

William Schmiedel of Sims Metal Management, the Ferrous Division’s new president, provided a market report on the electric arc furnace sector in the United States and Pacific Rim, noting the challenges the sector had to compete with integrated steel operations.

Pointing to moves made recently by Egypt, Mexico and Turkey, Schmiedel said, “We may see an entirely new wave of protectionism that will be legislated by many countries against China.”

In other market reports, European Ferrous Recovery & Recycling Federation (EFR) immediate -ast President Tom Bird of U.K.-based Metals Recycling explained that the low iron ore price and subsequent large-scale exports of Chinese finished steel product “has led to prices for steel scrap being forced down across EU regions,” though he expressed the hope that the market was “not far from the bottom.”

Parliamentary elections in Ukraine were likely to delay the distribution of new export quotas, according to Andrey Moiseenko of Ukrmet, based in Ukraine. Since May, he noted, overseas shipments had been running at 100,000 metric tons per month, with Turkey the biggest buyer.

Moiseenko added that ferrous scrap prices in Russia have been falling since the start of October, while Hisatoshi Kojo of Japan’s Metz Corp. added that Japanese scrap prices had slumped 16 percent since the start of September. “The scrap market will be continuously affected very much by Chinese steel exports,” Kojo noted.

For the fiscal year 2014/15, ferrous scrap imports into India were expected to total between 4.25 million and 4.5 million metric tons—exceeding the 3.8 million metric tons seen in 2013/14, but falling short of the record 6.9 million metric tons of 2012/13, reported Zain Nathani of the Nathani Group of Cos., based in India.

In an examination of the global steel market, BIR’s Ferrous Division Statistics Advisor Rolf Willeke pointed out that the 28 member companies in the European Union had been the world’s leading exporter in the first half of 2014 with a year-on-year increase of 4.6 percent to 8.584 million metric tons, whereas U.S. overseas shipments declined 23.5 percent to 7.595 million metric tons.

In another guest presentation, Björn Voigt, managing partner of Germany’s Active M&A Experts, identified “failed postmerger integration” as the key factor behind the majority of unsuccessful business mergers.


Source – RecyclingToday.com