Han Gang, Vice President of Cedar Holdings and the Chair of Stemcor Global Holdings Ltd, gave a speech on the 11th China International Steel Congress. He pointed out that with the transition of China steel sector to green development, demand for scrap would keep growing. Imports from overseas could be an effective means to address the shortfall of scrap-steel in the China domestic market. Stemcor is growing global scrap business, brings more scrap-steel, pig iron and billets among steel-making raw materials into China, strengthens cooperation with China steel companies and contributes to the low-carbon development of China steel sector.
As China pledged to hit carbon emission peak before 2030 and achieve carbon neutrality by 2060, the low-carbon and green path is the unavoidable for steel sector and also the focus of the 11th China International Steel Congress. According to He Wenbo, CEO of China Iron and Steel Association, green and low carbon development lies at the core of the transformation of steel sector. Compared with developed countries, one of the difficulties faced by China steel sector comes from the fact that most of steel in China were produced and consumed in the last two decades, which makes a low proportion of recyclable scrap and a meagre ferrous metal reserve.
In comparison to the traditional way of producing steel from iron ores, every tonne of steel smelted from scrap-steel could reduce 1.6 tonnes of carbon emission and 3 tonnes of solid waste. Improving the usage of scrap-steel is becoming an important path for China steel sector to cut carbon emission. That’s why China lifted the ban on scrap-steel imports on January 1 this year and reduced the provisional import tariff on steel products including scrap, pig iron, crude steel and ferrochrome to zero, which took effect on May 1.
According to Han Gang, Stemcor is well-prepared to embrace and accelerate the green development of China steel sector with its core competitiveness in collecting, sorting and distribute scrap. In 2020, scrap took up 20% of Stemcor’s ferrous metal supply. As China opens up its market to the scrap- steel starting from this year, Stemcor will boost its supply to China. The company has shipped scrap-steel from overseas to several China-based steel companies.
Unlike iron ore, scrap is scattered around the world. Well-established infrastructure and global network are needed to collect scrap. Stemcor has expanded its business globally since it was purchased by Cedar Holdings last year. Not long after that, Cedar approved Stemcor’s acquisition of a scrap-steel and deep-water port overseas. Looking forward, Stemcor will build and acquire more scrap yards and wharfs among infrastructure that is key to importing high-grade steel-scrap to China. In doing so, Stemcor will contribute to China steel sector transforming towards green development.
As made clear by Han Gang, Stemcor will leverage its coordinated global network in three dimensions. First, to help China steel plant grow oversea or provide all-encompassing supply chain services for overseas steel plant invested by China. Specifically, Stemcor will help them in products sale, green raw materials procurement and supply chain financial services. Second, to provide regional steel procurement services for oversea project of China engineering companies. Third, to work with overseas marketing and merchandising agencies of China steel makers, especially when involving car manufacturing and renewable energy for better connection with clients.