Chinese Ferrous Scrap Slowly Making its Way to Market

Steel Market Update (SMU) first reported that the Chinese were exporting ferrous scrap in an article on April 19, 2017. With the forced shut-downs of induction and electric arc furnaces by the Chinese equivalent of our EPA, the net result is that there is an abundance of ferrous scrap needing a home. Some of that scrap is making its way to Hong Kong, Japan, Korea and the Middle East.

We received photos of a recent shipment of Chinese scrap (one of which is the photo above) which was described to me as being “…auto bundles, all CRC trimmings and the bundles I sent to you (the photo) and sold as max 3% non-Fe (meaning can contain some coated products).

Our trading source told us, “John, more volume now… 195-200/mt fob stuffed in containers. We sold 2000mts to Middle East as attached at $240/mt CNF CY to CY.”

As reported previously in a SMU article on the subject dated May 4, 2017, one of the issues is the volume of scrap being sold in bits ‘n pieces as opposed to the 20,000-40,000 metric ton ships that the U.S. is used to dealing with.

We know there is interest from U.S. buyers as they are beginning to inquire about the scrap being offered and the Chinese are working on developing HS codes that are acceptable to the international community.