MRAI 2020: India poised to boost its ferrous scrap consumption

India’s economic growth rate may be tapering off from recent highs, but the nation’s government is backing major infrastructure spending that should keep its demand for steel and ferrous scrap on a growth trajectory. According to speakers at the 2020 Materials Recycling Association of India (MRAI) meeting near Delhi in February, the ferrous scrap needed will come from both overseas and domestic sources.

Presenters on the steel and ferrous scrap sector at MRAI, including one from India’s Ministry of Steel, were unanimous in saying the nation’s government is paying close attention to scrap collection and processing in the nation, including how end-of-life vehicles (ELVs) are handled.

Sujeet Samaddar of Delhi-based Samaddar Consulting says India is importing at least 4 million metric tons of ferrous scrap annually but predicts “that number will easily double” in the next 11 or 12 years. He says India will soon take second place behind Turkey as the second largest ferrous scrap importing nation in the world.

Samaddar and other MRAI speakers, however, also see India greatly increasing its ability to generate, collect and process scrap within its own borders. Much of that opportunity lies in the greater generation of ELVs and appliances, they commented.

Sanjay Mehta of manufacturing conglomerate MTC Group said there was a lack of “organized or formalized scrap collectors in this country who are capitalized well.” Mehta said the metal recycling rate and industry standards could be improved if informal recyclers were recognized by the government of India.

In addition to recycling that goes undocumented, Mehta speculated that “at least 30 percent of scrap [metal] is lying in waste bins.” He pointed to informal sector tracking and a government education program on the value of scrap metal “as small hurdles that can be taken care of by policy.”

Ruchika Chaudhry of India’s Ministry of Steel said steel production forecasts mean both the demand for imported scrap and domestic scrap are likely to grow. She said the ministry is studying how to modernize the scrap industry “to ensure that scrapping is done in an environmentally friendly way, and in the most efficient manner possible.”

That effort includes “the government taking up rules to make scrapping centers more organized [and] to facilitate more capital investment, including shredders,” said Chaudhry. “This needs to happen in the very near future; this is the only way we can ensure quality scrap,” she added.

As of 2020 on the ELV front, Samaddar said, “A lot of useful material that is lying on the road needs to be brought back into the economy.”  He said progress needs to be made “at the collection center level, at the depollution, dismantling level [and] at the materials recycling level.” All this, he added, “might take some time.”

Continued Samaddar, “The key challenge for most material recyclers [in India] is land.” Samaddar said on a recent trip to Japan he saw 50-acre facilities that could create clean, foundry-grade scrap materials all on one large site. “We should aspire to meet and better those standards,” he stated. Samaddar added, however, “To find that land from government sources or the private sector is, believe me, a big, big challenge.”

Panelist Robin Wiener, the president of the Washington-based Institute of Scrap Recycling Industries (ISRI), described India’s opportunity to establish new rules and policies as “exciting,” and said the MRAI, the Indian government and private sector leaders are wise to “plan for the future because it comes very quickly.”

On the ELV front, Wiener said it is important for the MRAI to have dialog with automakers “to find out what’s in that car, so there are no surprises [such as toxic materials] when recycling that car.” She said that dialog can also lead to important design-for-recycling discussions.

Wiener said the words used by recyclers and policymakers are important, and that it is “critical for governments to recognize what you do, and also what you’re not.” A key point, she said, is “scrap is not waste, but a critical resource for the circular economy.” MRAI members are not involved in waste management, added Wiener, “and to have that distinction is critical.”

In terms of lessons to be learned from the United States, Wiener pointed to its recycling equipment depreciation tax credit as a policy that can help Indian recyclers invest in helpful technology. She also urged them to trade based on ISRI specifications, and urged Indians to be involved in updating the specs, which she called “a living document.”

The MRAI’s 7^th Annual International Indian Material Recycling Conference was Feb. 7-9 at the Hotel Hyatt Regency Gurgaon near Delhi.