India to import 30 million tonnes per year of ferrous scrap by 2030 : Sanjay Mehta, President, Material Recycling Association of India (MRAI)
Posted By : Deepak Naik | Date : May 10 2022 6:35 AM
India will import about 30mn t/yr of ferrous scrap by 2030 to meet the government's vision of achieving 300mn t/yr of steel capacity, Material Recycling Association of India (MRAI) president Sanjay Mehta told Argus.
"Domestic scrap generation is definitely increasing because of higher construction and engineering activities and will touch about 35mn-40mn t of production in the next seven to eight years, but it will not be sufficient and the country will have to import more," Mehta said on the sidelines of the Indian Material Recycling Conference last week.
India's ferrous scrap imports excluding stainless and alloy scrap stood at 3.14mn t in April 2021-February 2022, declining for a third consecutive year, GTT data show. The country produces 25mn-30mn t/yr of ferrous scrap domestically.
But the decline in imports is temporary, MRAI director Zain Nathani said. He added that the drivers for the decrease were higher availability of sponge iron at cheaper rates, record prices for ferrous scrap, logistical challenges such as container availability, price issues and increased availability of domestic scrap. Ferrous scrap imports should increase in 2022-23, he said.
India should develop port infrastructure to handle bulk scrap vessels and improve port logistics to reduce costs, Mehta said during the conference. He also urged the government to reduce the goods and services tax (GST) on raw materials from 18pc to 5pc and mandate the usage of a minimum percentage of recyclable scrap in manufacturing sectors.
Several Indian auto companies like Mahindra and Maruti have entered the organised recycling space, but private investment hesitancy remains, as feedstock availability is limited despite India's introduction of a policy to encourage end-of-life vehicle scrapping.
"It's a bit of a chicken-and-egg situation," Nathani said. "The government feels that the private sector should enter the recycling space, while the private sector is waiting for more stronger policy."
The Bureau of Indian Standards is working with the MRAI to come up with updated ferrous scrap standards that will come out later this year and will make the sector a little more formal and structured, he said, but he added that the sector being organised or not organised is not affecting the availability of ferrous scrap.
Concerns are building that developed countries might slow scrap exports to focus on their domestic usage to hit carbon emissions goals, but Mehta believes that although these countries' domestic scrap usage will increase, their scrap processing capacity will also increase and India will continue to be able to import.