Scrap export potential mistakenly held back

24.01.2019

The Ukrainian Association of Secondary Metals (UAVtormet) estimates the country's metal fund at 300-500 million tons. And according to other sources, it is 600-650 million tons. In addition, the metal pool is constantly growing. Therefore, when collecting scrap of at least 5 million tons per year (and even twice as much), there is no need to deplete its reserves. This is the first.

Secondly, the wrong and the thesis that the scrap is not enough for metallurgists. Here are the numbers. In 2017, scrap collection amounted to 3.7 million tons. 3.2 million came to the metallurgical plants. In import, we received 28.6 thousand tons. Metallurgists in recent years used no more than 12% of imported scrap (in accordance with steel production volumes), and in 2017, about 15%. We emphasize that we are talking only about the raw materials brought to the metal factories from the outside. And also keep in mind that in the production of enterprises, in the manufacture of products, their own so-called recycled scrap is also formed.

The structure of domestic steelmaking capacities in comparison with 2017 did not change. Remains the same technology. Last year we produced 21.4 million. t steel. So, for its smelting it was necessary to 21.0 x 0.15 = 3.15 million. t imported scrap. Today we can harvest about 5 million tons of scrap per year, as was the case recently. It turns out, Ukraine can and should export at least 1.5 million. tons of scrap per year.
Interesting and more. When we sell huge amounts of iron ore, billet, slabs and other semi-finished products to foreign metallurgists, we ensure their operation to a greater extent than when we sell scrap. We note that in our country nobody restricts the export of iron ore, which is a more important raw material for metallurgy than scrap. Also there is no export duty on semi-finished products. Huge duty set only for scrap metal.
Go ahead. Ukraine has four more or less large electrometallurgical plants that need scrap metal, as well as micro-enterprises that do not play a significant role in the consumption of scrap. Full-cycle steel plants, which determine the face of our metallurgy, exploit blast furnaces and converters, and therefore can only work on ore. Not at all using scrap! The fact is that the expediency of the use in the production of steel scrap at such plants is determined primarily by the prices of iron ore on the one hand, and prices of ferrous scrap, on the other. The relatively low cost of ore (about $ 70 per ton) makes it profitable. Why?

The cost of finished products at plants with a full metallurgical cycle is 80% dependent on the cost of pig iron, and not the cost of imported scrap. For example, in the world markets last fall, a ton of pig iron cost almost $ 370, and scrap - about $ 315. And again it turns out that at the current cost of metallurgical redistribution, it is often more profitable to export scrap rather than melt it into billets or slabs and export these semi-finished products. In a word, contrary to popular belief, our metallurgists lack ferrous metal scrap with interest. Moreover, Ukraine is literally overstocked with this raw material. Our enterprises have unlimited opportunities to buy on the domestic market as much scrap as they want. And the volume of its procurement and export can be increased significantly! Already in 2019 in Ukraine, in addition to the volume that is collected now - almost 3.8 million. t. - another 1.0-1.5 million tons can be harvested.

You can familiarize yourself with the new version of the material at http://www.golos.com.ua/article/312683



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