The transformation and upgrading of the iron and steel industry, scrap has become a "top priority"

In the case of sustained high profits, in order to increase the output of long-process steel mills, the overall increase in the ratio of addition to waste, coupled with policy encouragement, the contribution rate of electric arc furnace to iron and steel production capacity has increased, and the status of scrap steel in the iron and steel industry chain has increased. Especially since 2019, scrap ships and scrap have been restricted from import one after another, and the price of scrap has risen sharply. According to SMM statistics, Changzhou tax scrap as an example, 2019 its price in 2502.4 yuan / ton, compared with 2018 overall increase of 80.7 yuan / ton, and even 2020 to date (January 20) to maintain the price of 2550 yuan / ton (see figure 1), and part of the electric arc furnace steel plant feedback, 2019 its actual purchase price was as high as 2650 yuan / ton.

Figure 1: spot price trend of scrap since 2018 (taking Changzhou scrap including tax price as an example)

A few days ago, Xuan Steel of Hegang said that in order to strengthen the awareness of product cost, the company's No.2 Steel Rolling Plant will increase the amount of waste steel into the converter and achieve the goal of stable production and reducing consumption: in November 2019, scrap consumes 74.252 kg / ton of steel, an increase of 2.484 kg / ton of steel compared with the previous month. With the increasing demand for scrap in blast furnace steel mills, under the condition that the supply side continues to be tight, the procurement of raw materials will be more difficult because the purchasing competitiveness of independent electric arc furnace steel mills is difficult to compete with the well-funded long-process steel mills. Furthermore, the "direction" of scrap resources is tantamount to a major factor affecting the supply side of the iron and steel industry. Scrap will become the "star of tomorrow" in the iron and steel industry chain.