![Small scrap yards will survive consolidation: Stahltag](https://media.kallanish.com/filer_public/b1/cf/b1cf3f09-e45d-4a88-819b-2d6246e408aa/64f14ba5-0811-49ca-bf07-9d5a8b7568ed.jpg)
Small scrap yards will survive consolidation: Stahltag
The relatively nascent trend of scrap yards being taken over by companies that are not recyclers will not mean the end of smaller players, says Sebastian Will, director at German recyclers organisation BVSE.
At MBI Infosource’s Stahltag conference in Frankfurt this week, speakers addressed the challenge of scrap being increasingly sought after as feedstock for both EAFs and oxygen converters, to improve steelmaking CO2 footprint.
Moreover, “Germany exports more than it imports, but it should be the other way round; we need to keep scrap in Europe,” ArcelorMittal Germany spokesman Arne Langner said at the event attended by Kallanish. “For this reason, ArcelorMittal has chosen to buy scrap yards in various countries.” He noted that ArcelorMittal’s takeover of Zlomex in Poland, announced last December, has not yet been finalised.
Apart from direct takeovers, some mills have chosen to forge closer cooperations with recyclers, as is the case with Salzgitter, said Will. He displayed some cynicism about ArcelorMittal’s “clever move” last year to acquire three yards from Alba. For the big recycling group, it was a welcome opportunity to get rid of yards that were performing poorly and in poor condition, he opined.
He noted that big recycler groups like TSR tend to have enormous costs and low margins to keep their networks running. “They may have big flagship suppliers like VW, but they also pay big for their new scrap, and end up with margins of 1.5%,” Will stated. “There is a learning process going on, and such processes result in small players finding new ways, as they can be faster, while big ones wait until the container is full,” he commented.
He identified one other trend, of companies with no physical operations acquiring scrap yards, to become exporters and to benefit from rising international prices. “This is of course absolutely against the interest of domestic mills, and that is why they are being pressured to act,” he stated.
Truly global, user-friendly coverage of the steel and related markets and industry that delivers the essential information quickly while delivering on most occasions just the right amount of between-the-lines comment and interpretation for a near real time news service of this kind.
Anonymous
Very good overview of the weekly steel market.
Anonymous