Ukrainian steel pipe producer Interpipe has indicated that scrap deficiency in the Ukrainian domestic market totaled 582,000 mt in the first 11 months of 2016, quoting data issued by the Association of Metallurgical Enterprises (Ukrmetallurgprom). In the given period, 2.9 million mt of scrap was delivered to steel mills, while scrap demand amounted to 3.5 million mt.
Interpipe said that the main reason for the deficit was a record low scrap collection volume. According to the Ukrmetallurgprom data, in the January-November period this year the scrap collection volume in Ukraine decreased to 3.1 million mt, 22 percent lower than in the same period of 2015 and 36.3 percent lower compared to the same period of 2014. This year, for the first time in the last 20 years, scrap collected in Ukraine was lower than domestic demand.
Given the scrap shortage, Interpipe said that it imported scrap in November, supported by the elimination of the five percent import duty on scrap.
"We will continue to increase the volume of imports of scrap from Moldova and Russia in December and January. In addition, we are considering other ways of reducing the shortage of raw materials. In particular, we are analyzing the feasibility of importing HBI and even steel billets,” said Denis Morozov, chief financial officer of Interpipe.