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Feature: International outlook

Presented with a global overview at the Bureau of International Recycling's (BIR) autumn convention, the ferrous division round table listened as the 2005 ferrous scrap market was described as "remarkable" and currently the focus of "a lot of nervousness".

Delivering his European market report to a large audience in Milan, Anton Van Genuchten of German company TSR placed his relative optimism in a number of factors, including good orders from the steel industry, available demand from outside the EU and the potential for winter weather to disrupt the supply of scrap.

Van Genuchten estimated that EU steelworks had consumed approximately 50 million tonnes of steel scrap in the first half of 2005, some 3% less than in the corresponding period of last year. The region's steel scrap exports fell by 15.5% to 4.419 million tonnes whereas imports rose 13.2% over the same period to 4.078 million tonnes. India took over from Turkey as the leading buyer of EU scrap by importing 1.357 million tonnes - equivalent to an increase of 257.1% over the first half of 2004. Turkish imports slid 35.8% to 1.062 million tonnes while EU steel scrap shipments to China dipped 14.2% to around 200,000 tonnes.

BIR ambassador Ikbal Nathani of India-based Nathani Group reported that his government had agreed to relax import procedures applied to ferrous scrap from the US and Europe. Inspections had been tightened in the wake of fatal accidents resulting from the inclusion of ammunition and other explosive materials in imported heavy melting scrap. However, US and EU scrap will be treated less rigorously since it is not coming from a war zone.

Ildar Neverov of Teplotov Resource explained that the Russian government had reduced the export duty on secondary aluminium alloys from 10% to 3% while the duty on nickel alloys had been removed all -together. In addition, from the start of next year, all scrap operations were set to become VAT-exempted as part of a bid to decriminalise the domestic industry.

In his review of the European non-ferrous scrap markets, Carmelo Paolucci of Trentavizi in Italy noted that high LME copper prices had created a lack of prompt availability of raw material. Meanwhile, poor consumption of semi-finished products had led to sluggish demand from secondary aluminium smelters.

The growing influence of the Chinese market was a key theme of the stainless steel and special alloys round table. A report from Michael Wright of ELG Haniel concluded that, over the next decade, China would increase its crude stainless output from 2.8 million tonnes per year to 14.4 million. China's stainless scrap requirement is expected to increase five-fold to 4.5 million tonnes (27% of global availability) while the country will need to import 1.6 million tonnes or 10% of world stainless steel scrap availability.

Wright observed that "China's product mix with regard to qualities is not yet stable". Noting fears that the proportion of CrMn grades will remain relatively high, he added: "CrMn and CrMnCu grades are really poisonous when they enter the recycling loop. Detection by magnet or conventional methods is very difficult. Unless we find an efficient technique of separation at source, the scrap reserve will be severely contaminated."

In his report on the European market, BIR stainless steel & special alloys committee chairman Sandro Giuliani of Italy's Giuliani Metalli said global stainless steel production was likely to be 9.7% lower in the second half

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