MARKET ANALYSIS
Brighter market on the
horizon
An upbeat survey of European traders sug-
gests a better year for the industry than some
observers had been expecting in late 2022.
According to those surveyed, the sup-
ply of scrap had improved slightly with
a quarter rating it as good. Only 29%
of companies thought it worse than
the previous quarter while 46% see
their supply situation as balanced.
Metal traders’ expectations in the
next three months are again better
than in the final quarter of 2022: 15%
expect a better supply while more
than two-thirds (71%) expect a con-
stant supply of scrap metal. Only 14%
of the metal traders anticipate a short-
age. Prices for most non-ferrous met-
als at the LME have picked up in
recent weeks, correlating to lower
stocks.
EXPORT BAN
At a time when free trade and protec-
tionism are constant themes for recy-
clers, the news that Indonesia is to
ban bauxite exports from June will
interest those buying and selling sec-
ondary aluminium. The country is the
world’s sixth-largest bauxite producer
and has the fifth-largest reserves,
according to the US Geological
Survey. It is the third-biggest supplier
to China.
Additionally, according to Asean
Briefing, the export of other unpro-
cessed minerals such as copper and
tin will also be stopped, although no
dates have been set out. According
to Reuters, President Joko Widodo
says the bauxite ban will replicate
his country’s success in developing
its nickel processing capacity after
halting ore exports in January 2020.
That enticed foreign investors,
mostly from China, to build local
smelters.
That measure also led to a dispute at
the World Trade Organization.
Following a complaint by the
European Union, WTO ruled in
November that the ban on ore
exports, as well as a requirement that
nickel had to be processed domesti-
cally prior to export, violated WTO
rules. In mid-December, a senior
Indonesian official told Bloomberg his
government, which is appealing, had
no plans to resume nickel ore exports
and wanted to impose an export tax
on semi-processed nickel.
48
conducted a survey of European deal-
ers on the situation in the secondary
metal industry. The result was pleas-
ing: the VDM business climate index
may have fallen slightly again but the
change was significantly smaller com-
pared to 2022.
Most companies now view the eco-
nomic situation as rather positive,
meaning the business position of most
metal recycling companies could well
improve in the next three months.
However, the developments of the
past few years show that even a slight
gust can be enough to make the busi-
ness climate worse again and there
remain plenty of economic, political
and geopolitical risks. All the same, the
non-ferrous industry in Europe is enter-
ing the new year with confidence.
The year started with something of a
surprise. The Association of German
Metal Dealers and Recyclers (VDM)
48-49-50-51_manon-ferrous.indd 48 03-02-2023 14:06
