2016 CMRA: China reaches out
2016 CMRA: China reaches out
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China’s scrap deficit is narrowing, causing its metals producers and recyclers to reexamine their business models, according to panelists at a session at the 2016 CMRA (China Nonferrous Metals Industry Association Recycling Metal Branch) Annual Convention in early November.
Dong Shen, the director of international marketing for United States-based OmniSource Corporation, said China remains “a big market for everybody,” but also remarked that the company’s nonferrous scrap sales to domestic buyers has trended upward the past two years.
The OmniSource trader also said that international investments, such as the principal of Asian aluminium producer Ye Chiu Group buying U.S.-based scrap processing firm Metalico Inc. in 2015, are changing the landscape but not always causing friction. “After the acquisition, I said we certainly cannot ask them not to do business,” he said of the transaction between the firms. “I think the future holds cooperation.”
Qin Yongming, the CEO of Hong Kong-based Chiho-Tiande Group, is working on behalf of one another Asian company that is investing overseas. Chiho-Tiande recently purchased the majority of the assets of Germany-based scrap processing firm Scholz AG.
Qin said he is aware that his firm’s takeover of Scholz will lend the appearance of “a snake trying to swallow an elephant,” with Scholz having a sales volume roughly 10 times that of Chiho-Tiande.
He said the move was made to put Chiho-Tiande “closer to the sources of our supply” to give the firm “better control” of its future. Qin added that the principal investors in Chiho-Tiande also want to benefit from German technical know-how. He referred to Germany as “highly advanced in industry [and] in recycling resources.” Added Qin, “This kind of management and operations is among the top in the world.”
Mark Lewon of Utah Metal Works in the U.S., who also is serving as the president of the Institute of Scrap Recycling Industries Inc. (ISRI) was asked if U.S.-based companies were likely to invest in Chinese processing capacity. “No, they’re too chicken,” was his reply. He added, “They understand their own markets, but once they get out of them, they don’t understand it.”
Two recyclers who attended the CMRA event and who spoke off the record after the session said American and European said recycling firms based their also feared investing in China when its regulatory and investment framework has proven that it can change suddenly and dramatically.
However, Jose Neumann, director of international marketing with Germany-based TSR Recycling GmbH, said he does see investments by European and American firms as possible. “China will produce a lot of scrap in 10 to 15 years. That could provide interest for European and U.S. companies to enter the scrap processing sector here,” he commented.
Song Yilong, a vice general manager with China Minmetals Corporation, said his company is adjusting to the “new normal” of copper prices that re lower than they were earlier this decade and in the previous decade. He credited U.S. companies with accepting this “new normal” sooner than some firms in China, and said some firms had “failed to adapt to this change.” Added Song, “There are a lot of challenges affecting profit.”
The 2016 CMRA Annual Convention was Nov. 7-9 at the Dongfang Hotel in Guangzhou, China.
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Source: Recycling Today
2016 CMRA: China reaches out
<![CDATA[China’s scrap deficit is narrowing, causing its metals producers and recyclers to reexamine their business models, according to panelists at a session at the 2016 CMRA (China Nonferrous Metals Industry Association Recycling Metal Branch) Annual Convention in early November. Dong Shen, the director of international marketing for United States-based OmniSource Corporation, said China remains “a big market for everybody,” but also remarked that the company’s nonferrous scrap sales to domestic buyers has trended upward the past two years. The OmniSource trader also said that international investments, such as the principal of Asian aluminium producer Ye Chiu Group buying U.S.-based scrap processing firm Metalico Inc. in 2015, are changing the landscape but not always causing friction. “After the acquisition, I said we certainly cannot ask them not to do business,” he said of the transaction between the firms. “I think the future holds cooperation.” Qin Yongming, the CEO of Hong Kong-based Chiho-Tiande Group, is working on behalf of one another Asian company that is investing overseas. Chiho-Tiande recently purchased the majority of the assets of Germany-based scrap processing firm Scholz AG. Qin said he is aware that his firm’s takeover of Scholz will lend the appearance of “a…