Tangshan research trip – why has the use of steel scrap in China risen this year?

Consumption of scrap among Chinese steelmakers notably increased in H1 2017. This is understandable for southern China, where there has been a surplus of scrap supply since the government ordered the closure of all induction furnaces. Similarly, the majority of steelmakers with electric arc furnaces have always used scrap as the main steelmaking raw material. However, we also noticed an increase in scrap consumption by steelmakers in northern China using basic oxygen furnaces. To find out what was driving their increase in scrap use, we visited several steel mills and traders in Tangshan, the city with China's largest steelmaking capacity. The slide pack summarises our findings, focusing on why BOF steelmakers have raised scrap consumption this year and whether this trend will continue in the short term.