The Bright Future For China's Steel Scrap Market In 2018 - 2

- Dec 14, 2017-

As for application of steel scrap, perspectives of converter and blast furnace were introduced by Mr. Liu. The converter steel mills have increased the usage of steel scrap, therefore they had more interest towards materials like heavy steel scrap, crushing materials and rebar-ends. The operating rate will increase by adding excess heat, which will also enhance steel scrap usage. As the steel scrap consumption increased, more steel mills began to add steel scrap to iron-making process. Some steel mills have loaded steel scrap with certain granularity to furnaces, but more steel scrap were added from outside the furnaces. The composite steel scrap ratio has reached 35% by means of measures. As for the production limitation areas in the heating seasons, steel scrap market showed an uptrend amid raw materials. According to the research on operating rate of 243 steel mills, operating rate of blast furnaces has decreased significantly since mid-Nov. Besides, the number in North China has decreased to 60.65% and that for Hebei was 57.74%. Based on the result, pig iron output affected by production limitation in Beijing-Tianjin-Hebei areas in the heating seasons was 26 Mln tonnes and 3.9 Mln tonnes steel scrap have been affected. The steel scrap consumption of North China was lower than that of East China and the average steel scrap ratio kept at 14.6%. However, the North China steel mills have kept increasing the consumption of steel scrap. Supposing the average steel scrap ratio increases by 2-3%, steel scrap consumption will rise by 2.5-3.25 Mln tonnes. Considering the output before Jan, the gap between demand and supply of steel scrap will become narrower. The reason is that steel mills will purchase steel scrap for winter storage. Furthermore, profit of steel mills also provides support to steel scrap demand. In general, steel scrap consumption will not fall unless steel price collapses. 

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