Chinese Scrap: Where There's a Will There's a Way

The following article was sent to us by one of our steel and scrap trading sources located within China. He has been actively involved in the export of ferrous scrap out of China this year and understands where that market is headed right now (and why). Here is what he shared with Steel Market Update earlier today:

Scrap exports from China have more or less ceased for the past 10-14 days due to government intervention. The reason being BOF mills in China have been procuring domestic scrap at cheap prices. Since April, total export of scrap from China is only around 175-200K tons. However, these export numbers, no matter how minimal they seem, have fueled the domestic price for scrap by 20-30 percent, and the domestic mills are crying foul. Since they are all state owned, they have appealed to the Port Customs to cease and deter exports of scrap and to protect the state owned mills’ interest. As you can imagine, the Customs Bureau has only one option.