SHANGHAI, May 25 (SMM) – China should promote the recycling and application of steel scrap and encourage the import of high-quality recyclable steel materials, in order to curb the rally in seaborne iron ore prices, said Li Lizhang, chairman of Fujian Sangang Minguang and a deputy to the National People's Congress (NPC).
Steel scrap is a necessary resource for steel production, and it is the only steelmaking raw material that can replace iron ore, he said in an interview with Securities Times.
“Over the years, the prices of overseas steel scrap have been lower than that of the domestic scrap while the quality is better than the domestic materials. Import prices of seaborne iron ore, meanwhile, have been elevated.”
A rise in steel scrap supply will deter the price increase for steel raw materials, improving profits at steel mills as a result.
SMM reported that China industry bodies have kicked off the formulation of recycled steel standards, paving the way to prevent a complete scrap import ban.
Foreign high-quality steel scrap was moved to the restricted import list in July 2019, and the imports are being steadily reduced under a quota system.
