CONF: China 2018 steel scrap output to hit 220 million t

For 2018, Chinese steel producers will consume some 187 million tonnes of scrap in the steelmaking and electric-arc furnace processes, or 81.8% of total supply. About 15 million tonnes will be consumed by foundries and 10 million tonnes stocked, accounting for 6.8% and 4.5% of the total respectively. In addition, some 8-10 million tonnes of steel scrap will be used as feedstock in blast furnaces in the iron-making process but this is excluded from the calculation as it does not directly involve steelmaking, Li said.

Significantly, over January-September the ratio of steel scrap consumed in steelmaking in China increased to 20.1%, fulfilling Beijing’s target two years ahead of schedule, according to statistics provided by CAMU.

In 2016, as part of central government plans to preserve the environment and conserve resources, China announced plans to lift the steel scrap consumption ratio in China’s upstream steel sector to 20% by 2020 from the average of 11.5% over 2011-2015. The results as of September this year show that the industry has fulfilled this target ahead of schedule, Li told delegates. The ratio reached 17.8% as of 2017, according to him.

China’s total crude steel output increased by 9.5% or 60.7 million tonnes on year over the January-September period to 699 million tonnes, while steel scrap consumption for steelmaking surged 38.9% or 39.4 million tonnes on year to 141 million tonnes, Li said.

Steel scrap consumed in the steelmaking process averaged 201 kilograms/tonne over the nine months, up 26.9% or 42.6 kg/t on year. In detail, average scrap consumed in converters surged 23% or 28.1 kg/t on year to 150.1 kg/t, while the volume melted in electric arc furnaces increased 6.7% or 41.4 kg/t on year to 660 kg/t.

“However, China’s scrap consumption ratio remains lower than the world average,” Li said, pointing out that during 2017, the scrap consumption ratio in steelmaking worldwide averaged 35.5%, with Turkey continuing to have the highest ratio at 80.8%.

Li anticipated that in the coming two years, steel scrap consumption in Chinese steelmaking will continue to grow. The country’s ongoing supply-side reform and tightening environmental protection requirement will continue encouraging steelmakers to increase the consumption of steel scrap, he argued.

Written by Sean Xie, xiepy@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com