China to boost steel scrap usage by 23% in next five years

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Workers dismantle scrap metal at a steel plant in Huaian, Jiangsu province, China March 4, 2019. REUTERS/Stringer/File Photo

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BEIJING, July 7 (Reuters) - China plans to increase its use of steel scrap by 23% to 320 million tonnes by 2025 and to increase production of recycled nonferrous metals, in an effort to ensure supplies and to meet the country's climate commitments.

The world's top metals consumer will boost its recycled nonferrous output to 20 million tonnes in the next five years from 14.5 million tonnes in 2020, the National Development and Reform Commission (NDRC) said on Wednesday.

That includes targets of four million tonnes of recycled copper, 11.5 million tonnes of recycled aluminium and 2.9 million tonnes of recycled lead, the state planner said in a statement.

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The NDRC also vowed to raise the substitution rate of renewable resources to primary resources and to enhance utilisation of low-grade ores, tailing dams and other resources.

China's steel scrap usage was around 260 million tonnes in 2020, which could replace 410 million tonnes of 62% iron ore input, said the state planner.

The country brought in more than one billion tonnes of iron ore per year, accounting for more than 80% of its total consumption.

Surging global metals prices have driven up producer price inflation in China this year, prompting authorities to take numerous steps to tamp down speculation. Prices for iron ore with 62% iron content for delivery to China have jumped 38% so far in 2021.

"The global supply chain had been seriously shocked by non-economic factors, increasing uncertainty of supplies... had posed a major challenge to China's resource security," said the NDRC.

The plan will also help the country to meet its carbon peak and carbon neutrality goals, according to the statement.

China plans to bring its greenhouse gas emissions to a peak before 2030 and to become "carbon neutral" by 2060. read more

The ferrous sector contributes about 15% to China's total carbon emissions while the nonferrous industry accounts for about 4.7%.

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Reporting by Min Zhang, Muyu Xu and Gabriel Crossley; Editing by Christopher Cushing and Kim Coghill

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