S. Africa’s clampdown on exports sparks anger

May 20, 2014 | 05:29 PM | Sean Davidson

Tags  ferrous scrap, exports, South Africa, United States, India, South African Trade Aministration, Export Control Guidelines, export rules Price Preference System

NEW YORK — South Africa’s latest effort to control scrap exports could trigger a spike in demand for U.S. ferrous scrap, send U.S. prices higher and impact American steel producers, while South African mills benefit from a protectionist measure, according to containerized scrap traders.

Scrap merchants in South Africa, the Middle East, India, Southeast Asia and the United States slammed a May 9 proposed amendment released by the South African International Trade Administration Commission aimed at addressing loopholes that weakened its September 2013 Export Control Guidelines on exports of ferrous and nonferrous scrap.

An absence of definitions and clarifications on critical matters such as whether or not the government’s recommended price included freight costs for deliveries to mills and what the payment terms were resulted in almost uninterrupted exports of ferrous scrap from South Africa despite the September 2013 introduction of new export rules, which many initially felt would virtually shut down exporters.

The 2013 rules included provisions for a 20-percent discount on export prices for local mills, with a government recommended price published once a month under a "Price Preference System."....

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