ISRI2018: Trade opportunities beyond the headlines

The ISRI2018 convention, held in Las Vegas in mid-April and hosted by the Washington-based Institute of Scrap Recycling Industries (ISRI), was attended by more than 5,100 people. While the majority of attendees were North Americans, the event continues to attract scrap buyers and sellers from around the world, despite global trade disputes.

Based on the comments of American attendees—and of equipment vendors in the ISRI2018 exhibit hall—recyclers in the United States are equipping themselves to process more material domestically in the wake of China’s scrap import restrictions.

That did not discourage China-based scrap processors and consumers from attending and even exhibiting at the convention, with companies such as Hong Kong-based Grand Environment Group promoting a new facility being set up in Malaysia.

Diego Arróspide Benavides of Peru-based electric arc furnace (EAF) steelmaker Aceros Arequipa attended the event seeking stronger connections with North American scrap suppliers. According to Benavides, Aceros Arequipa is preparing to double its capacity in a nation that has a ferrous scrap supply deficit.

In 2017, China imported some 900,000 metric tons of ferrous scrap from the U.S., and Chinese government restrictions on imported scrap have not scrutinized iron and steel scrap in the same way plastic, mixed paper and some nonferrous scrap have been targeted.

Nonetheless, China’s ferrous scrap deficit is disappearing, most analysts agree, and Benavides told Recycling Today Peru and Latin America is a region U.S. ferrous scrap recyclers should be examining.

Ferrous scrap broker Nathan Fruchter of Lawrence, New York-based Idoru Trading Corp., in a conversation with Recycling Today, referred to Bangladesh as “probably the most important newcomer’s market” in the sector. “Bangladesh is the new darling of the ferrous scrap export market,” he continued. “With a population of over 160 million, it is one of the most densely populated countries. There’s not much room to build out, so they have to build up.” That, he noted, means a reliance on structural steel.

Also in Bangladesh’s favor, said Fruchter: “They are finally enjoying some political stability in the last four years, which has led to good economic growth and investments into the domestic steel industry in the previous two to three years.”

Fruchter said, in 2016, “The Bangladeshi government took a few measures to protect domestic steel production by imposing high duties on imported semis and rebars, hence boosting the local steel mills. Thus, the banks are now also more inclined to give larger loans to the steel producers. The majority of steel producers in Bangladesh are either induction based or EAF, requiring imported ferrous scrap. Bangladesh is expected to import more than 3 million tons of ferrous scrap in 2018. Is it any wonder that they are the new darlings of the ferrous scrap export market, if you consider that in 2015 they only imported about 500,000 tons?”

Fruchter is bullish the country will continue to need imported ferrous scrap. “I expect strong economic growth to continue, but remember there are some constant reminders of setbacks, like the threat of heavy flooding due to out of control rains Bangladesh gets; and then there’s always a threat of a political shift. They hold national elections later in 2018. Let’s hope they stay the course,” he commented.

Another trader in attendance at ISRI2018 was Dipan Patel (who also goes by the single name Puaal), who serves as an export or business manager for New Jersey-based firms. Puaal said he has worked diligently to find an export market for cathode ray tube (CRT) leaded glass, which has long been a difficult item for electronic scrap recyclers to handle in the U.S.

Puaal said his connection with a South Korea-based smelter has provided a viable outlet for the CRT funnel glass, and that it has been just one of several projects he has been working on this decade to connect U.S. scrap with existing or emerging overseas markets.

He estimates that between 2014 and 2018 he has helped export “more than 15 million tons of nonferrous metal scrap of U.S. origin, as well as some U.S.-made prime stainless steel coils” to nations including China, South Korea, Taiwan, Vietnam, India and Pakistan, perhaps equating to $20 million worth of exports.

Puaal remarked that both the current global trade environment and changes to U.S. immigration policy are a concern to him, as he sees barrier-free global trade as vital to both his own career and the industry’s overall prosperity.

ISRI2018 was April 14-19 at the Mandalay Bay Resort & Casino in Las Vegas.