In 2017, along with the rapid rise of domestic steel prices, scrap prices also oscillated all the way up, and at the end of 2017 exceeded 2,000 yuan (ton price, the same below) mark. Although the thorough removal of “strip steel” has had a certain impact on scrap demand and prices have been adjusted, in general, scrap prices have continued to rise along with the rise in steel prices. The data monitoring of the Lange Steel Cloud Business Platform shows that as of January 26, the heavy waste price in Tangshan District was 2,230 yuan, which was 850 yuan higher than the April 2017 low of 1,380 yuan, an increase of 61.6%. A price is also a new high in scrap prices in recent years. In the next step, environmental protection will become the biggest driver of the scrap industry, and scrap utilization will double in the next 2-3 years.
Unrecognized scrap resources
In 2017, China's crude steel output was 832 million tons. There is no doubt that China's crude steel output ranks first in the world, even more than the 2-10th output. However, in addition to the high iron ore imports, another significant feature of Chinese steel production is that scrap utilization has been very low.
According to the statistics of the China Scrap Association, from January to September 2017, the total consumption of scrap steel in the country was 10.123 million tons, an increase of 36.53 million tons, an increase of 56.5%. The scrap ratio also rose by a large margin, reaching 15.85%, an increase of 5.1 percentage points over the same period of the previous year. It is estimated that the total consumption of steel scrap steel in 2017 will be around 140 million tons.
Even with a large increase, China's scrap steelmaking ratio is still very low. At present, the average scrap steelmaking ratio in the world is 51.6%, and in some steel countries, this value is much higher. For example, in the United States, the scrap steelmaking ratio is 75.6%, and the highest in Turkey's scrap steelmaking ratio is Up to 90%! In other words, China's scrap steelmaking ratio is still far below the world average, and there is a lot of room for growth.
Why is the use of scrap utilization in China so low? China's steel, which accounts for more than half of the world's production capacity, has a scrap utilization rate of only 15%. Perhaps this has a lot to do with the higher cost of scrap utilization.
Since most of China's steel production still uses blast furnace technology, the use rate of scrap has been difficult to keep up. Wang Guoqing, director of the Lange Steel Research Center, said that scrap steel was mainly used in the production of ground steel in intermediate frequency furnaces. However, in the process of banning the ground steel before the end of June 2017, the demand for scrap decreased as the intermediate frequency furnace continued to clear. As a result, scrap prices continued to fall, once fell back to 1,500 yuan; in the second half of the year, with the rise in steel prices, the price advantage of scrap steel continued to be highlighted, coupled with the lucrative steel products and the heating season, to produce more steel, The proportion of converter steel used in long-run steel mills has been continuously improved, and the production capacity of electric steel re-production has been continuously improved. The utilization rate of scrap has been greatly improved, and the price has fluctuated.
But overall, because the current use of scrap steelmaking is more expensive than iron ore, the cost per ton of steel is about 200-300 yuan higher. Therefore, the enthusiasm of steel enterprises to use scrap is not high, which leads to the ratio of scrap to steel. It is difficult to improve the situation.
Policy to promote the use of scrap
Although the cost of scrap steel utilization is relatively high, compared with iron ore, scrap steel is an energy-saving renewable resource that can be recycled indefinitely. Wang Guoqing has calculated this account. She said that compared with one ton of steel for scrap steel, Using iron ore to refine one ton of steel can reduce 1.6 tons of carbon emissions, 3 tons of solid waste slag emissions, can replace 1.6 tons of iron concentrate, and can save one ton of raw coal and 1.7 tons of new water, so the benefits of using scrap resources are also Obvious.
At the government level, attention has also been paid to the use of scrap. At the beginning of January 2018, the Ministry of Industry and Information Technology issued the newly revised “Measures for the Implementation of Capacity Replacement in the Steel Industry”, which stipulates that the projects of steel companies in various regions that have exited the converter and built electric furnaces can be replaced by the same amount, and the converters must be withdrawn from the supporting sintering. Coke oven, blast furnace and other equipment. Wang Guoqing said that the country's capacity replacement policy did not mention electric furnaces. The information reflects the support of national policies for electric steelmaking, and with the resumption of production and new production of electric furnaces in the future, there are still long-run steel mills. Driven by factors such as high consumption of scrap steel, scrap demand will increase significantly, so the market price of scrap in 2018 will maintain a rising trend.
In 2016-2017, the steel industry has achieved significant results in de-capacity production. In 2018, it is the year of deepening the overcapacity of steel. The resumption of the resumption of production of strip steel and the resumption of production capacity that has been discontinued are the key tasks. In the case that the strip steel is completely removed and the resumption of production is hopeless, many medium frequency furnaces will inevitably turn to the electric furnace. Together with the new electric furnace capacity, the utilization rate of the electric furnace will be greatly improved, which will also drive the demand for scrap.
At the same time, in order to promote the utilization of scrap steel resources, and strengthen the management of scrap steel processing industry, regulate the production and operation behavior of scrap steel processing industry, promote the supply and demand of scrap steel, accelerate the transformation and upgrading of the industry and green development, the Ministry of Industry and Information Technology The Access Conditions and the Interim Measures for the Administration of Access Announcement for the Scrap Steel Processing Industry have been revised to promote the healthy development of the scrap steel industry and increase the utilization rate of scrap steel. In the "Industrial Green Development Plan (2016-2020)" issued by the Ministry of Industry and Information Technology, it is also clearly stated that by 2020, the recycling of scrap steel will reach more than 150 million tons. In the "Steel Industry Adjustment Policy", it is proposed that by 2025, China's steelmaking scrap ratio will reach 30%.
According to this, the China Scrap Association has also formulated the “13th Five-Year Plan for Development of the Waste Steel Industry”, which proposes that by 2020, China’s scrap steel ratio will double by 20% during the “Twelfth Five-Year Plan” period. From the perspective of the use of scrap in 2017, this target may be achieved ahead of schedule.
Green steel boosts scrap development
Beyond the policy level, the biggest boost to the increase in scrap utilization is the increasingly strict environmental policy.
The heating season in 2017 made everyone see the government's great determination in environmental protection. We don't dare to take it lightly for the environmental protection policy after the heating season. It can be expected that increasingly strict environmental protection policies will be the norm facing the steel industry in the future. The use of scrap can largely achieve the green development of the steel industry. At the National Waste Steel Conference held at the end of 2017, Li Shubin, executive vice president and secretary general of the China Association of Scrap Steel Applications, mentioned the implementation of the new environmental protection law and the increasing environmental supervision, as well as the carbon emissions trading system across the country. Establishment, etc., all created conditions for the development of the scrap steel industry.
It is reported that the steel mills built in the United States since 1962 are all green and environmentally friendly induction cooker steel mills. Only in China, China currently relies entirely on iron ore for steel making. In response to the use of scrap steel, Yin Ruizhen, an academician of the Chinese Academy of Engineering and former deputy director of the Ministry of Metallurgy, said that in the next 20 years, China's scrap steel resources will grow rapidly, and the steel industry process structure, steel mill model and layout, and ferrite resource consumption, Energy consumption and carbon emissions have an important impact, which in turn contributes to the greening of society and ecological harmony.
Domestic scrap steel processing equipment manufacturers are also improving their technical equipment level to meet the increasing use of scrap steel resources. For example, the Shaanxi-China scrap steel recycling and processing base of the Shaanxi Steel Group, which was just started, was officially put into operation. It is understood that this project plans to invest 130 million yuan and will equip two 600,000 tons/year scrap processing and crushing lines and two 200,000 tons/year scrap. Cut the machine line. The completion of this project will effectively integrate the scrap resources in Hanzhong and Sichuan-Chongqing areas and realize the recycling of resources. In addition, China Gezhouba Group has reorganized more than 60 scrap steel processing and distribution enterprises in two years. In 2016, it exported more than 5 million tons of scrap steel. In 2017, it exported more than 10 million tons of scrap steel, providing an example for the transformation and upgrading of the entire industry and joint restructuring. In addition, Maanshan Iron and Steel Co., Ltd. and Renewable Resources Co., Ltd. and Tianjin Steel Pipe The group company has established long-term and stable supply cooperation relationship with 10 scrap processing and distribution enterprises, and continuously promotes the healthy development of the scrap steel industry.
The steel industry should develop in a green direction, and the comprehensive utilization of scrap steel will be an important link that cannot be ignored. Moreover, China also has the conditions for large-scale use of scrap resources. Wang Guoqing said that with the accumulation of steel use in China, the amount of scrap resources is gradually increasing. By the end of 2020, China's steel reserves will reach 10 billion tons, and scrap resources. The amount of production can reach 200 million tons. By 2025, it will reach 280 million tons. In 2030, it will reach 330 million tons. A large amount of scrap resources will force steel mills to use more scrap steel. "This is also the green development of the steel industry. An embodiment of this, Wang Guoqing stressed.
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