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Although we continue to see a decrease from the Chinese market,
there has been a recent ramp up in steel production by non-Chinese region, shifting the focus of steel scrap exporters to destinations including India, Turkey, and South Asian countries. Unlike China these countries have experienced significant rise in steel production over the past year. And the domestic scrap output is now insufficient to meet the growing steel scrap demand.
India’s steel production has risen 3.3% to 75.1 million tones over the past year, even during the time when global steel output dropped by almost 2.5%. Due to the fall in supply from domestic sources India will likely see a higher import rate of steel scrap and the scrap consumption by the country is projected to double over the next 10 years.
Bangladesh has also seen a dramatic rise over 2015 and is expected to have imports grow at the fastest pace in 2016. Scrap steel imports are expected to total around 3 million tonnes almost 5 times the consumption levels experienced in 2015. Bangladesh holds a favorable import structure which will help boost even more imports of scrap to the country.
On the other hand China’s production of steel dropped by 2.2%, which result in producers having to ship even more abroad after Chinas devalued in currency. The sinking of the yuan may make the nations exports cheaper for overseas buyers.
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