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Govt announces Steel Scrap Recycling Policy, aims to reduce imports; scrap centres planned

In a bid to ensure quality scrap for the steel industry, the government on Friday came out with a Steel Scrap Recycling Policy that aims to reduce imports, conserve resources and save energy.

The country's steel scrap imports were valued at Rs 24,500 crore in 2017-18, while the deficit was to the tune of 7 MT.

"The policy aims to ... promote circular economy in the steel sector", besides promoting "a formal and scientific collection, dismantling and processing activities for end of life products that are sources of recyclable (ferrous, non- ferrous and other non-metallic) scraps which will lead to resource conservation and energy savings and setting up of an environmentally sound management system for handling ferrous scrap," the Ministry of Steel said in a statement.

National Steel Policy 2017 aims to develop a globally competitive steel industry by creating 300 MT per annum steel production capacity by 2030 with a contribution of 35-40 per cent from EAF/IF (Electric Arc Furnace/Induction Furnace) route.

It said the scrap policy will ensure processing and recycling of products in an organised, safe and environment friendly manner, besides evolving a responsive ecosystem and producing high quality ferrous scrap for quality steel production minimising the dependency on imports.

The statement said the policy envisages a framework to facilitate and promote establishment of metal scrapping centres in India, which will ensure scientific processing and recycling of ferrous scrap generated from various sources and a variety of products.

Among others, it also aims to decongest the Indian cities from reuse of ferrous scrap, besides creating a mechanism for treating waste streams and residues produced from dismantling and shredding facilities in compliance to Hazardous & Other Wastes (Management & Trans boundary Movement) Rules, 2016 issued by the Ministry of Environment and Forests.

The policy is based on "6Rs principles of Reduce, Reuse, Recycle, Recover, Redesign and Remanufacture through scientific handling, processing and disposal of all types of recyclable scraps including non-ferrous scraps, through authorized centers / facility".

The gap between demand and supply of scrap can be reduced in the future and the country may be self-sufficient by 2030, it added.

The ministry said its endeavour is to develop a globally competitive steel industry by adopting state-of-the-art environment friendly technologies.

Although scrap is the main raw material for secondary sector, the primary sector also uses scrap in the charge mix of BOF (Basic Oxygen Furnace) to the tune of 15 per cent to improve efficiency, minimise cost of production and other process needs.

There is a worldwide trend to increase steel production using scrap as the main raw material as recycling of scrap helps in conservation of vital natural resources besides other numerous benefits. The use of every tonne of scrap shall save 1.1 tonne of iron ore, 630 kg of coking coal and 55 kg of limestone. There shall be considerable saving in specific energy consumption also, the statement said.

It said the availability of scrap is a major issue in India and in 2017 the deficit was to the tune of 7 MT. This was imported at the cost of more than Rs 24,500 crore in 2017-18.

The government said the scrapping policy shall ensure that quality scrap is available for the steel industry.

Scrap is an important input for the electric furnaces. If quality scrap is provided as the charge to the electric furnaces, then the furnaces can produce high grade steel. High grade steel scrap shall not have the impurities if processing is done with the scrap processing centres and by shredders etc.

"The current supply of scrap is 25 MT from the domestic unorganised scrap industry and 7 MT from import of scrap. There is potential to harness this 7 MT of scrap that is currently being imported...

"To produce 7 MT more of scrap, the country shall require 70 scrap processing centres each with the capacity of 1 lakh tonnes; this is without disturbing the existing dismantling centres. The 70 scrap processing centres shall require about 300 collections and dismantling centres on the presumption that 4 collecting and dismantling centres cater to scrap processing centre," the statement said.

In case of steel production rising to 250 MT, the requirement of scrap shall rise to 70-80 MT, it noted.

"This shall require about 700 scrap processing centres, that is 700 shredders. These shall in turn be fed by 2800-3000 collections and dismantling centres spread all over the country," the statement said.

It added operating on the 4+1 hub and spoke model, where 4 collection and dismantling centres are to cater to 1 scrap processing centre, then 400 jobs would be created by one such composite unit.

"And for 70 units producing a total of 7 MT of scrap the potential for employment generation would be of 2800 persons. If the country was to produce 70 MT, as expected as per NSP 2017, the employment generation could be in the range of 3 lakh jobs," the statement said.