Leveraging global scrap market, improving export of China′s steel production capacity and achieving economic benefits
HE Kun1,2, WANG Li1,3
1. School of Energy and Environmental Engineering, University of Science and Technology Beijing, Beijing 100083, China; 2. China ENFI Research Institute, Beijing 100038, China; 3. Beijing Engineering Research Centre of Energy Saving and Environmental Protection, Beijing 100083, China
Abstract：At present, China's steel industry in transition is facing many pressures, such as anti-dumping containment, high dependence on foreign iron ore (and no pricing power), capacity reduction, energy and environmental pressures, etc. In this case, this paper proposes to relieve these pressures by leveraging the international scrap market, that is, improve the output of China's steel production capacity and achieve environmental benefits by participating in the international scrap trade and actively purchasing scrap resources in the international market. The aim is to reduce the foreign crude steel reserves and increase the export of China's steel production capacity, rather than simply remove production capacity. Moreover, pushing up the steel price in the international market to improve the competitiveness of China's export steel and ease the pressure of anti-dumping. Besides that, using imported scrap in steel production to reduce the dependence of iron ore on foreign countries, so as to compete for the right of iron ore pricing. Finally, improving the scrap ratio in steel production, and reducing production energy consumption and emissions. Taking the data of 2018 as an example, purchasing 86 million tons of international scrap (accounting for 18% of the scrap consumption of major steel producing countries) can increase China's scrap ratio to 30%, increase China's EAF steel ratio to about 20%, reduce China's iron ore import by at least 10% and save 300 million tons of standard coal. In addition, China can also obtain economic benefits by increasing steel export volume and price.
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HE Kun, WANG Li. Leveraging global scrap market, improving export of China′s steel production capacity and achieving economic benefits[J]. China Metallurgy, 2021, 31(2): 103-108.
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2021, Vol. 31 
