Hoffman: Growing EAF, BOF capacity in Asia means big changes for recycled ferrous

Written by Philip Hoffman

It was a hot week in Da Nang, Vietnam at the Southeast Asia Iron and Steel Institute’s (SEAISI) 2024 Conference & Exhibition May 13-16. The usual suspect mills were in attendance from Vietnam, Malaysia, Indonesia, Japan and China to name a few.

The main topic of discussion was green steel, which needs an entire article dedicated to it, but what was also brought to light relating to scrap was the upcoming increase in capacity coming online in the next few years in the Asia Pacific region. Both EAF and BOF capacity will expand by at least 17 million tons (not including India) by 2026 through early 2027, if all planned capacity goes online. Some of this is replacement capacity of BOFs to EAFs, as in Japan and Korea, and others are BOF expansions that need to use 30% scrap in their melt to minimize carbon emissions.

As we all know, North American capacity is set to significantly increase, and, according to Phil Bell at the Steel Manufacturers Association, capacity will expand by 18 million tons in North America in the next two to three years — all of which is EAF.

The combination sets the stage for a paradigm shift of significant proportions when it comes to the demand for scrap. So much so that both the EU and China are legislating a prohibition of ferrous scrap export, albeit for different reasons.

More articles are to come on the details of both export bans and the details of all the planned capacity expansion; but ferrous scrap is set to take on a new level of importance globally over the next few years.

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