The Chinese authorities have issued a document, banning the import of all waste scrap, including recycling steel material, which are subject to quotas now, starting from January 1, 2021. In fact, this statement is reiterating the government policy to protect the local market and is not expected to impact the market much, as the new standards for ferrous scrap imports are still expected to be approved by the end of the year, which will open the Chinese market for foreign sellers of good quality scrap.
The Ministry of Ecology and Environment, the Ministry of Commerce, the National Development and Reform Commission, and the General Administration of Customs jointly issued a statement on November 25 that all imports of solid waste will be forbidden in China from the next year with the authorities stopping to accept and approve applications for import permits under the quotas after December 31, 2020. This means that the current system will stop working from 2020 and the quota for imports of raw material issued for a year will not be prolonged.
This statement has worried the market participants, but in fact, according to a number of sources and officials, this does not cancel the intention of the Chinese government to implement a new system of import of steel scrap by issuing the standardization base, which will prevent the entrance of low quality material to the country.
The recycling steel materials which meet new standards could be imported and will not be required to be subject to the quota limit. The draft plan for new standards for recycling steel materials has been issued in November and into the soliciting opinion stage, which will officially be issued by the end of this year, as announced by China Metallurgical Industry Planning and Research Institute (MPI) previously.