Scrap collecton in Ukraine in 2023 increased by 28.1% y/y

During the same period, the supply of raw materials to consumers increased by 15.4% y/y

The volume of ferrous scrap collecton in Ukraine in 2023 increased by 28.1% – to 1.27 million tons compared to 2022. Scrap supplies to steelmaking companies in the same period amounted to 1.034 million tons (+15.4% y/y).

This was announced by Volodymyr Bubley, President of the UAVtormet Association, during a coordination meeting on topical issues of the scrap and processing industries in 2024.

«The actual performance of the industry almost completely coincided with our forecast. In 2023, we expected scrap collection and consumption in the domestic market to be 1.2 million tons and 1 million tons. In fact, we have 1.277 million tons of scrap collection and 1.034 million tons of consumption. Technological reserves of consumers amount to 50-60 thousand tons. We expect a positive trend in the work of steelmakers and expect to increase steel production in Ukraine in 2024 to 6.8-7 million tons», said Volodymyr Bubley.

Scrap exports in 2023 increased by 3.4 times compared to 2022 – to 182.48 thousand tons. Export revenues increased 2.8 times year-on-year – to $52.7 million. Last year, the largest consumers of Ukrainian raw materials were Poland – 160.6 thousand tons, Greece – 13.2 thousand tons and Bulgaria – 2.7 thousand tons.

Prices on the Turkish market for scrap HMS 1&2 80:20 (on CFR terms) in January stabilized in the range of $418-425 per ton. According to Kallanish, the majority of market participants do not see any possibility for further decline and believe that prices have already reached the bottom. A significant increase in prices for raw materials was observed from late October to mid-December last year – on average by 21%, up to $428 per ton.

Scrap is a strategic raw material for the global steel industry to achieve its carbon neutrality goals. Most developed countries are in favor of a ban on scrap exports to preserve critical raw materials in the context of green steel industry. The European Union may turn from an exporter to an importer of steel scrap in less than 5 years, as global steelmakers switch to electric arc furnaces, so the competition for this raw material will only intensify.

In particular, EUROFEER advocates for the European Union to include scrap in the list of critical raw materials, as only equal access to scrap will ensure the long-term competitiveness of European steelmakers and avoid an increase in carbon emissions.

As GMK Center reported earlier, in 2022, scrap collecton in Ukraine decreased by 75.9% compared to 2021, to 996.7 thousand tons. Exports of raw materials decreased by 11.4 times y/y – to 53.6 thousand tons during the year, while imports decreased by 92.1% y/y – to 1.8 thousand tons. Domestic supplies of raw materials to domestic steel mills decreased by 73% – to 895.7 thousand tons.