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

The European Commission is currently revising waste shipment regulation. In line with the New Circular Economy Action Plan, the foreseen objectives are to facilitate re-use and recycling within the EU through simplified waste shipment procedures but to restrict waste exports that have harmful environmental and health impacts in third countries or can be treated domestically within the EU. The new rules could also impact ferrous scrap exports, which are classified as waste in the region.


Under this review, policymakers are discussing the potential restrictions and ban on waste export from the EU, which may indirectly impact ferrous scrap exports. The European Commission is expected to prepare its official proposal in 2021, after which the document will be adopted by EU member states and by the European Union Parliament.


However, there are no particular indications that a ban on ferrous exports will be recommended in the anticipated new rules at present. Emmanuel Katrakis, Secretary-General of the European Recycling Industries Confederation told Davis Index that unfortunately, a trend to put all materials in the same basket provides some room for potential restrictions on metal scrap export. Yet, steel scrap from recycling is a global commodity, and trade restrictions would undermine the very objectives set by the Circular Economy. 


He added that instead of considering trade restrictions, Europe should instead support a higher usage of steel scrap in steelmaking by rewarding their well-documented CO2 and energy savings, which will support scaling up Europe’s EAF steel capacity. 


A recent study by Fraunhofer Umsicht made for the German Steel Scrap Recycling Association (BDSV) shows that in 2018 only the CO2 savings in the EU stemming from the use of steel scrap in steelmaking is equivalent to the automobile traffic emissions of France, Great Britain, and Belgium combined.


Charles de Lusignan, spokesperson and head of communications, Eurofer, told Davis Index that steel scrap generated in the EU should be considered a strategic resource as its use is essential not only to the completion of the EU’s circular economy but also in supporting the region’s CO2 reduction objectives. Scrap has a considerable volume of energy embedded in it and a CO2 reduction potential is lost by the EU economy when it is exported to third countries. Lusignan added that the EU should promote the availability of ferrous scrap to the EU steel sector, secure its quality and support the use of secondary raw materials—such as industrial co-generated materials—to replace virgin resources.


In 2019, net exports of ferrous scrap from the EU stood at 18.91mn mt compared to a total consumption of around 87.68mn mt, according to Eurofer data.

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