Scrap boost is on the horizon as outlook for steel rebounds positively – but not to any great extent just yet.
The global steel scrap market is expected to reach 1 050 million tonnes by 2033, up from its current 655 million tonnes, according to a new report from analysts Fact.MR. ‘Increasing efforts by steel producers to cut carbon emissions are anticipated to fuel market expansion during the projected period,’ a researcher concludes.
The report notes that a future need for steel scrap could be fuelled by an increase in the demand for raw materials used in steel manufacturing from quickly growing and emerging economies such as China, India, and Brazil. Demand has been enhanced by different governments implementing favourable policies surrounding the metal recycling business in response to the growing worries about the rapid depletion of natural resources.
Fact.MR expects the growth of the global steel scrap market to exceed 1 000 million tonnes by 2033 at a CAGR of 4.9% with China’s market evolving at 5.7%. The ‘obsolete segment’ is anticipated to expand at an annual rate of 5.3%.
US STAYS POSITIVE
Fastmarkets’ latest trend indicator for scrap steel prices in the US in April was in positive territory with a reading of 58.8 but down from the 65.2 recorded in March. The model suggested prices could rise by an average of 6.3%.
‘That expectation comes amid reports that steel mills were unable to fully cover all their requirements in March, with domestic steel scrap inventory levels depleted in the wake of robust domestic and overseas demand in recent weeks,’ it said.
FM found that just over half of respondents to its survey expected prices to rise in April. More than one third of respondents said that stronger demand would be the main driver while just under 20% anticipated unchanged market conditions, and a similar amount expected demand to weaken compared with March. Prime steel scrap prices were again due to outperform their obsolete and shredded counterparts in April.
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