Global scrap and DRI demand projected to rise significantly

 

ABU DHABI (Scrap Monster): Rising steel products demand is likely to lead to significant increase in global demand for scrap and DRI over the period of next five years. The demand for scrap and DRI is projected to be on the rise till 2019. On the other hand, pig iron market is likely to be at a standstill during this period. The projections were made by World Steel Association (WSA) during the recently concluded BIR World Recycling Convention and Exhibition at Dubai.

 

According to Edwin Basson, Director-General, WSA, the global scrap demand is forecast to rise by 110 million tons to 695 million tons by 2019. The sharp rise in scrap requirement is on the back of projected surge in global steel products consumption. The steel demand is expected to touch 1.66 billion tons by 2020. The scrap demand is likely to report strong growth in China, Turkey, ASEAN countries and NAFTA region.

 

By 2019, the share of EAFs in steel casting is likely to increase from current 27% to 30%. The rise in EAF production will result in increased demand for scrap. However, EAF production may stagnate at these levels on account of electricity dearth and scrap supply shortage. Limited sources of scrap supply have made scrap collection a tedious affair for collectors in many parts of the world.

 

The global demand for DRI is likely to increase by 35 million t to reach 110 million t by 2019. The large scale capacity expansions at Iranian steelmaking facilities may drive the demand for DRI. Increased demand is also projected in other regions such as India, MENA region and NAFTA region.

 

Meantime, pig iron demand is likely to remain stagnant at 1.25 billion t, almost unchanged from the current demand.

 

The participants at the Convention noted that developments in scrap segment are directly related to steel industry. A resurgent steel industry could only contribute to the improvement of scrap segment.