During 2021-22, 220 MT of ferrous scrap was traded across the globe. During the same year, the net steel scrap importer, India, imported 4 MT of steel scrap as revealed by the World Steel Association. Most of the steel scrap is accumulated by the informal sector and employed by the steel sector in India. They follow a framework so that the scrap recycling process can be carried out ethically.
In 2019, the government of India issued the Steel Scrap Recycling Policy. The policy offers a framework in order to promote the establishment of and facilitate scrapping centres for carrying out ferrous scrap processing and recycling in an organised, safe, scientific, and environmentally friendly manner.
When it comes to prices, domestic steel scrap rates are purely market-driven. With that being said, (HMS 80:20) iron scrap prices today in Chennai are hovering at Rs 32,500-33,000/ton.
In this article, let’s explore the significance and Code Of Classification of ferrous scrap and the latest revisions made to them:
Significance Of Scrap Grading
Being a primary raw material for the secondary sector, ferrous scrap is used in the primary steelmaking process (approximately 15%), to keep efficiency on the higher side and production cost on the lower side.
The availability of right-graded scrap that too at a competitive price is crucial for the growth of the steel industry. For a circular economy, steel scrap is considered the most conducive since it can be recycled and reused infinitely. In a scrap-deficit country like India, the availability of graded scrap is a major concern in this day and age. The standardisation of the code of classification not only helps to eradicate the knowledge vacuum of graded scrap but will facilitate the segregation, processing, and categorisation process at all the scrap processing centres in the country. This, in turn, will not promote a competitive and healthy ecosystem as well as will further emphasise maximising the scrap collection and graded scrap availability.
Is Standard Code Really Needed?
This standard exists to assist the steel industry in the optimum utilisation of ferrous scrap. The domestic consumption of steel and iron scrap is set to shoot up. In such a situation, the standard does one key job and leaves no room for confusion and ambiguity that can arise from individual interpretations of different scrap grades and terminology used in the ferrous scrap industry.
Updates: Ferrous Scrap’s Code Of Classification
After the draft was finalised by the Wrought Steel Products Sectional Committee (approved by the Metallurgical Engineering Division Council), the Bureau of Indian Standards (BIS) adopted this Indian Standard (Second Revision). You would be surprised to know that this standard came into existence in 1963.
Keeping in mind the experience gained during the last few years, the committee revised it to keep it at par with the Institute of Steel Recycling Industries (ISRI) classification while reviewing the standard.
Let’s have a look at the key changes made under the latest revision:
- Scope: Now, the scope of the standard has expanded to cover all the different types of ferrous scrap. The ferrous scraps are categorised into three segments:
- Home scrap
- Prompt scrap
- Obsolete scrap
- Home Scrap that can be sold to the market directly is also included. That said, Home Scrap which is consumed internally by steel manufacturing plants is excluded. Presently, that is above and beyond the scope of current standards.
- Contamination, cleanliness, and non-conformity safety are elaborated in detail.
- Forms, size, and shape-based classification enable the separation of re-melting scrap from re-manufacturing and re-rolling scrap types. After the initial sorting, the segregated re-melting scrap may be further processed in slitters, cutters, or shredders so that its size is reduced. This, in turn, increases the bulk density of the finished batches. Finally, the prepared re-melting scraps are supplied in loose form including shredded and sheared, bundled form, or baled.
- Provision for coated sample supply is covered in the current revision.
The current standard introduced new scrap category types such as light melting scrap (LMS), incinerator bundle, terne plate bundle, steel can bundle, foundry scraps, automotive scraps railroad scraps, tyre bead wires, turnings, and borings.
Additionally, in order to strike a balance between exported ferrous scrap and domestic ferrous scrap, different dimensions in the existing standard are at par with ISRI standards.
- A new section on re-manufacturing scraps is introduced. All Home scrap, Prompt scrap, and Obsolete scrap that can directly be converted into finished goods without requiring re-rolling or re-manufacturing are also included.
In The Nutshell
Keeping in mind the rising steel production levels and India’s position as the world’s second-largest steel producer, now raw material is needed in large quantities more than ever. Only then, the domestic demand can be fulfilled. In such a scenario, the optimum scrap utilisation will significantly lessen the burden on raw material mining as all as drastically reduce the energy consumption and carbon emission levels. The dual benefits make it a win-win situation.
A scrap standard on par with all international standards will ensure that the scrap used for steelmaking is top-notch. The key updates made to the Code Of Classification Of Ferrous Scrap during the second revision of the codes aimed at rationalising the former version, making it more friendly, and broadening its horizons to cover almost every ferrous scrap variety. Being driven by the market, iron scrap prices today are a reflection of the current market situation.