SA recyclers’ anger at possible extension to export scrap ban

South African recyclers are complaining that the Government could extend its ban on the export of scrap metal and introduce other measures which they claim ‘will kill business and the livelihoods of millions of South Africans’.

The Recycling Association of South Africa (RASA) has submitted its response to a consultation, noting ‘a huge outcry from the business sector, including the manufacturing and steel sectors, who have shown that the consequences on the ban has led to the creation of a distorted local market’.

RASA ceo Nancy Strachan adds: ‘The ban has also been an attributing factor in the closure and imminent closure of businesses in South Africa.’

In November 2022, South Africa implemented an export ban to address damage and theft to the national infrastructure.

But RASA complains: ‘There has been little evidence that it was implemented to address the theft of infrastructure, but rather that it has been used as a trade remedy to ensure local foundries, using scrap in their inputs, have an unfair competitive advantage.’

Monopoly

The association argues a trade policy cannot be justified as an instrument to address criminality in South Africa. It believes local foundries have embarked on a price predatory process by setting up a complex monopoly, and says this is proved by the daily pricing of Grade 201/HMS by four of the largest scrap metal consumers since May 2023.

RASA also complains that tinplate and cast iron grades are included in the export ban, even though they are not required by South African foundries.

Additionally, it says, ‘banning the export of ferrous and copper without providing recyclers with local markets at a fair price in a transparent manner will kill business and the livelihoods of millions of South Africans’.

A further annoyance is a proposal to restrict the trade in copper solely between registered scrap metal dealers. From where, RADSA asks, will the scrap originate?

‘Businesses that generate scrap in the course of their normal business, such as appliance repairs, would be excluded from selling this copper, unless they too registered as scrap metal dealers.

‘We have consulted with the Waste Pickers Associations in South Africa who have indicated that they were not consulted in this. The waste reclaimers who recover scrap metals from landfill sites would be excluded from the recovery of copper from burnt out appliances, scrapped motor vehicles etc and this scrap metal could not be “legally” recovered.’

Stracham concludes: ‘As we have seen locally, the metals industry is a complex eco system, whereby the impacts of a forced changed that is contrary to normal market conditions, has the ability to have severe consequences.’