In 2007, approximately 482 million tonnes of recyclable ferrous metals were utilised in global steel production. Although industry fundamentals have weakened markedly in line with the world-wide economic and financial crisis, these fundamentals should again improve once the economic outlook and conditions improve. Healthy demand for raw materials for steel production in China, South Korea, Turkey, Russia and India should as a result again resume. Scrap metal became increasingly popular due to the lower emissions it produces. Reclam Group’s pricing is determined by global prices.
As raw materials make up an increasing proportion of overall costs, steel makers are continuously looking for more cost effective inputs, and scrap is an ideal solution.
Since the early 1990s, the use of recyclable ferrous metals in steel manufacturing has grown dramatically. Global demand for recyclable ferrous metals has over the last few years shown an increasing upward trend. Total global crude steel production increased from 1.05 billion tonnes in 2004 to 1.344 billion tonnes in 2007.
About 200 million tonnes of scrap is traded internationally each year, of which about 90 million tonnes are seaborne trade.
South Africa’s recyclable ferrous metals market is in excess of 3 million tonnes per annum.
Non – ferrous metals
Consumption of non-ferrous metals has increased considerably in emerging markets before the onset of the world-wide economic and financial crisis, but has as a result decreased in recent months. The growth in supply has been limited by labour issues, natural disasters, a decline in asset quality, increasing capital and operating costs.
South Africa’s recyclable non ferrous metals market is approximately 400,000 tonnes per annum.
Reclam Group exports recycled ferrous metal products to various steel producers primarily situated in Malaysia, India and Taiwan. Processing locations throughout the coastal regions in Southern Africa, combined with attractive sourcing of raw materials in the southern African market and South Africa’s location relative to major importing regions, enable us to compete in international recycled ferrous metal product markets.
Sources of Supply:
Reclam Group purchases recyclable ferrous raw materials from a variety of industrial companies, the informal sector and merchants in South Africa and neighbouring countries. These raw materials include steel, iron and other by products from industrial manufacturers in the steel industry, and obsolete materials such as cars, appliances, machinery and equipment, and building and other structure demolition projects.
The company’s ability to purchase a wide variety of recyclable ferrous raw materials, ranging from small to extremely large, as well as to accept deliveries at numerous collection points in relatively close proximity to suppliers, make Reclam Group the preferred customer in many instances.
The strong relationships we have developed with suppliers over the past 20 to 30 years position us well to increase our access to the pool of recyclable raw materials located in South Africa and neighbouring countries.
We buy a significant portion of our recyclable raw materials from hundreds of scrap metal merchants, or dealers, based on long standing relationships across South Africa. Our geographic coverage, product range and capacity to handle a wide variety of types and volumes of recyclable raw materials give us a competitive advantage.