Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Integrated steel producer Emirates Steel, plans to purchase at least 1mn mt of scrap material through local channels to use as feedstock. 


The steelmaker, following the UAE Ministry of Economy’s recent directive banning ferrous scrap exports from the country, confirmed its commitment to procure local scrap that is consistent with global pricing in a media statement on Tuesday. The company had reduced scrap volume use to 280,000mt in 2019, citing complications in obtaining the material locally. 


Beginning in 2012, Emirates Steel has been producing 3.5mn mt of steel per year. The company manufactured 17mn mt of rebar and wire rod between 2012 and 2019. 


Emirates steel has its own 3,000-hp shredder, built in 2017, which provides scrap material for its electric arc furnaces and serves to recycle steel produced in the country, while lessening waste. Scrap makes up about 30pc of the raw material used in the company’s steel making plant one (SMP1) at present. The steel producer said its goal is to grow scrap use as feedstock for other steel making facilities, which would alleviate the company’s dependence on iron ore and also ensure cost savings from increasing iron ore prices.


Saeed Ghumran Al Remeithi, chief executive officer of Emirates steel, expressed the company’s support of the Ministry’s assertion to stop scrap exports that can be used as local feedstock for steel production. Also, as scrap is recycled, manufacturers have to import the finished product from overseas at elevated prices as it is a vital element in several industries. The local steel industry presently needs all domestic scrap trade to support its operations, Al Remeithi added.


Next to Japan, the UAE is presently Asia’s second largest scrap exporter comprising 1.6pc of global ferrous scrap exports. The UAE has 1.5mn mt of annual scrap inventory and its main scrap import associates include India at 31pc, Pakistan at 25pc, and Oman at 11pc.

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