Japan Steels’Scrap Purchase Drops by 2.3% in 2005

Japanese generation of processing scrap from manufacturers including new cutting scrap and steel turning scrap increases under strong activity by manufacturers. Domestic steel makers increased the purchase of new cutting scrap by 2.3% to 4.96 million tonnes in 2005 from 2004, according to Japan Ferrous Raw Materials Association. The purchase volume increased by 7.3% to 2.45 million tonnes for steel turning scrap. The makers purchased more processing scrap when makers reduced total purchase volume of ferrous scrap. Domestic steel makers increased ferrous scrap purchase volume by 2.3% to 28.34 million tonnes in 2005 from 2004 due to lower output by electric furnaces. They reduced local scrap purchase by 1.3% to 24.14 million tonnes, which increased by 0.9 percentage points to 85.2% of total volume, while they decreased scrap purchase from other area by 8% to 4.19 million tonnes. Domestic steels reduced the heavy scrap purchase by 4.9% to 16.22 million tonnes in 2005 from 2004 while they increased the shredder scrap purchase by 9.4% to 2.32 million tonnes due to end of life vehicle recycling law started January 2005. Under the new law, automakers gather and treat shredder dust, which was hard to treat, and recyclers increased to shred waste vehicle without worry for the dust. Domestic electric furnaces consumed 29.63 million tonnes of scrap, which represents 97.6% of scrap usage rate, and converters used 1.048 million tonnes of scrap, which represents 11.4% of usage rate, in 2005. The scrap usage rate of converters reached the highest level since 1975 due to higher raw steel output by converters.