Chinas potential transformation into a net exporter of
scrap in less than a decade could impact metal recyclers,
industry veterans said at AMMs Steel Scrap
Conference in Chicago.
"China could be a net
exporter in the next 12 to 15 years, or at least not a net
importer by this time," said Bob Kelman, president of New
York-based Sims Metal Management Ltd.s North America
Kelman said some
projections show China could be self-sufficient as early as
2022, with other forecasts suggesting this wont happen
until 2030. "It is going to come and it is going to come fairly
quickly," Kelman said, noting that China is capable of melting
700 million tons a year and already exports 65 million tons of
finished steel products.
Jack Stutz, chief
operating officer of Orange, Calif.-based SA Recycling LLC,
said the inevitable paradigm shift wont be crippling,
noting that most of Chinas steelmaking capabilities rely
on other inputs and the country isnt operating at its
"Most of their
steelmaking is integrated and they dont buy as much as
you would think," Stutz said.
SA Recycling is a
large scrap exporter and has already learned to react quickly
when one offshore customer reduces its appetite. "We are pretty
used to this now and investigate freight rates around the
world. So when our business slows we are able to be flexible
and ship in one area when another area slows down," he said.
"At some point China will be self-sustained, but I dont
see it as an issue for U.S. scrap processors."