China's 'Green Fence' slowing scrap clearance

A government-backed operation to clamp down on illegal imports of waste into China may slow down shipments of ferrous scrap into the country as customs authorities pay closer attention to all shipments.

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Operation Green Fence was launched in mid-February by China's customs authorities, aimed at making sure scrap suppliers and importers are obeying all existing rules.

“The campaign has slowed down port-clearing, since every scrap cargo will be checked,” a steel mill source in Shanghai said.

The crackdown is leading to a shortage of copper scrap in China, but the effect on ferrous scrap may be less pronounced, market participants said.

“Ferrous scrap comes in standardised products, and little waste or hazardous substances can be found in standardised cargoes imported from reputable suppliers overseas,” Wang Zhenwu, chairman of China Assn of Metal Scrap Utilisation, told Steel First.

“China began regulating its ferrous scrap import markets in the mid-80s, and seldom have there been cases reported about waste or hazardous substances being imported,” he added.

Local customs authorities have been asked to report back on the results of Operation Green Fence in mid-December this year.

“For non-ferrous recyclers in China, they do import leftovers of shredded cars that had their ferrous parts removed,” an industry source in Beijing said.

“With intense manual work, a tiny quantity of copper and some other non-ferrous metals can be recycled. But along with these are huge volumes of other wastes such as rubber and sponge. That’s why China wants to tackle the problem,” he added.

China's ferrous scrap import volumes have already been falling this year because of weak demand and high overseas prices, the first mill source said.

“The impact of the port slowdown is limited,” he said.

China imported 379,640.49 tonnes of ferrous scrap in March, down 6.6% from February, and down 23% year-on-year.

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