Scrap-importing developing countries may become scrap exporters in long term

At the SteelOrbis Spring '10 Conference and 62nd IREPAS meeting held in Budapest, technical director of the Association of the Hungarian Steel Industry, Dr. Pál Tardy, stated that generation of scrap reserves is linked both to current crude steel production and steel production and consumption of the previous 15-50 years.
 
Dr. Tardy said that in the last few years scrap generation has hardly been able to cover demand due to the dynamic growth of steel production, adding that the amount of scrap being added to scrap reserves has been decreasing in recent years. However, stressing that the recent decline of production and consumption may lead to an increase in scrap reserves, Dr. Tardy said that lower demand would ease the stress on the scrap market.
 
Another interesting point Dr. Tardy underlined was that the indirect trade of steel decreases scrap availability in developed countries and increases it in developing countries in the long term, since exporters of steel-intensive goods like machinery and motor vehicles also export scrap, if it is considered that these goods will be added to scrap reserves within a 15-year period. Thus, Dr. Tardy said that developing countries like China, which import scrap, machinery and motor vehicles, would become scrap exporters in the long term, while developed countries may begin importing scrap, due to their declining scrap reserves.
 
Regarding the relationship between the European Commission's emission trading system (ETS) and scrap availibility, Dr. Tardy predicted the new enviromental measures will the increase scrap usage of steelmakers and consequently scrap availibility will decline, leading to hikes in scrap prices.