The European Commission activated the customs surveillance system at the end of July to monitor shipments of metal wastes and scrap into and out of the EU. The system covers steel and other ferrous scrap, aluminium and copper scrap. The aim is to collect "more structured and detailed information" on the EU’s scrap imports and exports in order to prepare potential measures to "ensure sufficient access to scrap for EU’s metals industries". The Commission will assess whether further action is needed by the end of the current quarter.
Reacting to the decision, the European Recycling Industries' Confederation (EuRIC) said it supports "smarter oversight", but warned that rushed trade measures could backfire, hurting recyclers without fixing raw material access. "Any next steps must be proportionate, fact-based, and circular economy-proof", the umbrella organisation said.
EuRIC underlined that the assessment must consider both the quantities and qualities of recycled metals being exported and imported. "However, to have a full picture, the EU will also need to monitor the imports of primary materials competing with recycled materials, such as iron sponge or direct-reduced iron (DRI), which have exponentially surged since the beginning of the year, as well as the EU's forecast production capacity", stated Olivier François, the President of EuRIC. "This is essential to avoid introducing measures that could unintentionally harm the competitiveness of the European recycling industry without improving circular materials' availability for EU manufacturers."
EuRIC has on numerus occasions reiterated that the exports of recycled metals have been keeping recycling businesses alive by offsetting a structurally low and declining EU demand. Unfair competition faced by European aluminium and steel producers had to be addressed, but this "should not be done at the expense of recyclers," the association stated.
EuRIC also pointed out that twelve CN codes had been listed for assessing steel, but only three each for aluminium and copper. The umbrella organisation urges the Commission to consider the differences in quality between exported recycled materials and those that are in demand on the domestic EU market, as well as the forecast demand at European level. This should be "a fundamental pre-requisite to any decisions", according to EuRIC.
EU Commission points to "decline in scrap availability"
The EU Commission's Directorate-General for Taxation and Customs Union justified the decision to activate the surveillance system by saying that the EU "is experiencing a decline in metal scrap availability for recycling, also because of 'scrap leakage' to third countries". The introduction of a 50 per cent tariff by the United States on a wide range of steel and aluminium products (excluding scrap) "may further worsen this issue as rising global prices of primary materials increase the incentive to export scrap abroad", according to the DG.
EuRIC disagrees with the Commission’s assertion that scrap availability is declining within the EU and that recycling primarily occurs in mills. "It is necessary to recall that EU metal recyclers are reprocessing metallic waste into recycled metals which replace or complement extracted raw materials utilised by steel, aluminium or copper mills. The high recycling rates achieved for metallic waste are a reflection of the investments made by European recyclers over the past decades to become the backbone of a more circular economy. Since 1975, over €9.3 were invested across Europe by steel recyclers alone to fund 267 shredding plants. Hence, the allegations that recycling occurs within mills risks discarding the broader role of the recycling sector in the circular economy," according to the association.
EuRIC also argues that "in light of the ongoing geopolitical tensions", Europe should strengthen its credibility as a reliable trade partner. It should therefore avoid introducing measures that could hamper well-established partnerships while failing to increase the recycled metals use rate within the EU.
