Scrap metal export controls out of the European Union would be a step backwards in the global decarbonization drive and could also result in lower scrap arisings within the European region, speakers at the International Bureau of Recycling, or BIR, convention in Barcelona said May 23.This could fly in the face of the aim of the current revision to the European Commission’s Waste Shipments Regulation, which sets out to boost the competitiveness of scrap supplies to EU industry to facilitate decarbonization, the convention heard.“Export controls would be the most tragic development in the industry for the last 40 years,” said Michael Lion, chair of BIR’s International Trade Council at the event, attended by some 1,200 delegates representing 500 companies and recycling organizations from 60 countries.EU-28 was by far the world’s biggest steel scrap exporter in 2019 – the latest year for which data is available – exporting 21.79 million mt. Exports had been on a rising trend for years. The US was the second biggest exporter that year, with 17.68 million mt.Turkey was by far the world’s biggest ferrous scrap importer in 2019, taking 18.86 million mt, mainly from EU nations and the US.Murat Bayram, board member of BIR’s non-ferrous committee, said the export controls currently proposed by the EC would mean fewer scrap arisings and less available technology within the region. Reducing scrap exports would also reduce the price incentive to produce scrap within the EU as there would be more local availability, he indicated.The European Parliament’s Environment Committee is expected to vote on the proposed WSR amendments in October, after these were presented by rapporteur Pernille Weiss May 11. As well as attempting to ensure availability of high-grade scrap within the EU, the amendments aim to ban exports of EU-origin scrap to countries which don’t have EU waste treatment standards. Non-OECD countries would be obliged to conduct independent audits of their processing facilities. Cross-border shipment of waste between EU nations would be facilitated for reuse, recycling or disposal.
Brought forward as a result of the EU’s Green Deal of 2019, the review aims to improve environmental standards in recycling industries, tackle illegal waste shipments and ensure the EU doesn’t export its waste challenges to third countries, the EC has said.
Merchant consolidation foreseenThe global scrap industry’s fear is that the proposed export curbs would distort market flows and prices in an increasingly controlled market. The amendments — widely expected to be approved due to the weight of the steel mills and metals smelters they would favor — have been opposed by European Recycling Industries’ Confederation EuRIC, which represents some 5,500 companies in all waste areas, and by BIR which has also proposed some amendments, Ross Bartley, BIR environment and technology director, said at a press briefing. Many scrap merchants and processors worldwide are relatively small companies, often family-owned, which could be subject to consolidation if the review passes.According to Bartley, the EC ‘s main intention with the WSR is to reduce purchase scrap prices for domestic consumers including steel mills and non-ferrous metals smelters of scrap metals available in or entering Europe, to assist their production and decarbonization processes.The review will in first place favor EU steel mills and smelters, in second place OECD countries, and lastly, developing countries, Bartley noted, with a major concern being what will happen to scrap availability in non-OECD countries.“We’ve encouraged the developing world to reduce emissions but they don’t have the local supplies of scrap needed to decarbonize effectively,” noted BIR president Tom Bird, describing the proposed changes as “protectionist.”OECD countries including Turkey, Australia, Canada, Japan, the UK and the US will see trade flows altered due to the review.“We foresee the market will foreclose [if the review is approved] and access to international markets won’t be the same,” said EuRic representative Antoine Stilo. “We will have internal capacity [in the EU] for which there will be no demand.” Local demand might need to be stimulated by operating a mandatory recycled content rule, he noted.The review needs to differentiate the approach taken for different waste, or scrap materials, Stilo said. A general prohibition would seem to make sense only for more “problematic” materials such as plastics, batteries, electric and electronic assemblies and end of life motor vehicles and tyres, while there should be free trade for raw materials from recycling meeting quality specifications, he said.
Closing the loopWhile the WSR review aims, in circular economy terms, to “close the loop,” it will essentially achieve this only on a regional basis.
“Closing the loop is important but closing the loop doesn’t mean closing markets,” Bayram said, noting a “more aggressive” tone has emerged from both the steel and nonferrous sectors “to influence governments to ban scrap exports.”
“The EU plan is to close the loop in the EU,” said Hannu Heiskanen, vice president, recycled raw material, at copper producer Aurubis, with production facilities in various European nations.
“Aurubis is generally in favor of the free market but considers that it makes sense to close the loop in materials recycling, which is in the interests of everyone,” Heiskanen said on the event’s sidelines.
Aurubis is the world’s second-largest producer of copper cathode, which is on average 50% recycled within the company’s installations. It is a net buyer of copper and brass scrap and aims to grow more in the recycling area, he said.
— Diana Kinch