Scrap dealers welcome steel mill revival, warn against monopoly

RAD­HI­CA DE SIL­VA

Se­nior Mul­ti­me­dia Re­porter

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Scrap Iron Deal­ers As­so­ci­a­tion pres­i­dent Al­lan Fer­gu­son says the in­dus­try wel­comes the Gov­ern­ment’s plan to re­open Trinidad and To­ba­go’s steel mill, but warned that scrap met­al ex­ports must con­tin­ue to en­sure com­pe­ti­tion and pro­tect deal­ers from un­fair pric­ing.

His com­ments come af­ter Trade Min­is­ter Ka­ma Ma­haraj an­nounced that the Gov­ern­ment had signed a mem­o­ran­dum of un­der­stand­ing (MOU) with a Cana­di­an com­pa­ny to restart the steel mill, with plans to process the coun­try’s scrap iron and waste tyres lo­cal­ly.

Fer­gu­son said the as­so­ci­a­tion ful­ly sup­ports the re­open­ing of the fa­cil­i­ty, pro­vid­ed deal­ers are paid in­ter­na­tion­al mar­ket prices for their scrap.

“We wel­come the steel mill open­ing. We have ab­solute­ly no prob­lem with it as long as the State buys from us at the same in­ter­na­tion­al price,” he said.

How­ev­er, he cau­tioned against cre­at­ing a mo­nop­oly by di­rect­ing all scrap met­al to a sin­gle lo­cal buy­er.

“We must not stop de­mand­ing our ex­ports be­cause when you have on­ly one mar­ket, that cre­ates a great prob­lem. We must al­low peo­ple who want to ex­port to con­tin­ue ex­port­ing,” Fer­gu­son said.

He said deal­ers have long-stand­ing ex­port con­tracts and forc­ing all scrap to be sold lo­cal­ly could re­sult in sig­nif­i­cant fi­nan­cial loss­es.

“We can­not agree to sup­ply­ing all the ma­te­r­i­al to one mill be­cause any­time you re­move com­pe­ti­tion, you leave it open for prob­lems,” he added.

Fer­gu­son al­so dis­put­ed sug­ges­tions that the re­opened mill would be ca­pa­ble of pro­cess­ing every type of scrap gen­er­at­ed lo­cal­ly.

He ex­plained that the for­mer Arcelor­Mit­tal fa­cil­i­ty was de­signed main­ly for heavy scrap and not lighter ma­te­ri­als such as thin sheet met­al and gal­vanised prod­ucts.

“There is no steel mill in the world that takes every sin­gle type of scrap,” he said, adding that some ma­te­ri­als would still need to be ex­port­ed.

He al­so ques­tioned whether the plant would have suf­fi­cient gas and elec­tric­i­ty to process a wider range of scrap prod­ucts, not­ing that such op­er­a­tions re­quire sig­nif­i­cant en­er­gy re­sources.

Fer­gu­son said the as­so­ci­a­tion was es­tab­lished in 1991 af­ter deal­ers com­plained that they were not re­ceiv­ing in­ter­na­tion­al prices from the for­mer steel pro­duc­er.

He main­tained that any new op­er­a­tor should work through the as­so­ci­a­tion, as was done pre­vi­ous­ly, and ho­n­our agree­ments gov­ern­ing the pur­chase of scrap from mem­bers.

Turn­ing to the on­go­ing ban on cop­per ex­ports, Fer­gu­son said re­strict­ing ex­ports alone would not stop cop­per theft.

He ar­gued that au­thor­i­ties should in­stead reg­u­late lo­cal buy­ers and strength­en over­sight of the in­dus­try.

“You have to fix the prob­lem prop­er­ly. If you don’t reg­u­late the in­dus­try, peo­ple will con­tin­ue steal­ing cop­per and find­ing ways to ex­port it,” he said.

Fer­gu­son called for the li­cens­ing of scrap col­lec­tors and manda­to­ry iden­ti­fi­ca­tion for any­one sell­ing cop­per to scrap­yards.

He said cop­per re­mains the most valu­able com­mod­i­ty in the scrap in­dus­try, fetch­ing about $40,000 per tonne, mak­ing it a prime tar­get for thieves.

“Cop­per theft is not just a Trinidad and To­ba­go prob­lem. It is hap­pen­ing all over the world be­cause of the high price,” he said.

Fer­gu­son wel­comed the Gov­ern­ment’s de­ci­sion to en­gage in­dus­try stake­hold­ers on the is­sue, say­ing pre­vi­ous poli­cies had been in­tro­duced with­out suf­fi­cient con­sul­ta­tion.

He es­ti­mat­ed that while there are on­ly about 28 li­censed scrap­yards op­er­at­ing across the coun­try, more than 250 un­li­censed yards may be in op­er­a­tion.

The as­so­ci­a­tion al­so be­lieves em­ploy­ment in the in­dus­try has fall­en sharply, with an es­ti­mat­ed 10,000 to 13,000 peo­ple now earn­ing a liveli­hood from scrap met­al, down from about 25,000 be­fore the 2022 shut­down of the sec­tor.

Mean­while, Steel Work­ers Trade Union pres­i­dent Tim­o­thy Bai­ley said the union had not been con­sult­ed on the pro­posed project and first learnt of the MOU through me­dia re­ports.

“We heard about the MOU just like every­body else, and since then we have not heard any­thing from any­one. That’s all we know,” Bai­ley said.

He said the union had not been con­tact­ed by the Min­istry of Trade and In­dus­try or any oth­er gov­ern­ment rep­re­sen­ta­tive since the an­nounce­ment.

De­spite that, Bai­ley said any ef­fort to re­vive the steel in­dus­try would be wel­comed.

“Any plan to re­open the steel mill would be a good idea. The steel plant in gen­er­al would be a good idea. But again, at the end of the day, we have no de­tails. We are wait­ing to hear the de­tails of such a plan,” he said.

Bai­ley said the union was al­so con­cerned that there had been no dis­cus­sion on how the pro­pos­al would af­fect the liq­ui­da­tion process in­volv­ing the for­mer Arcelor­Mit­tal op­er­a­tion, which has been on­go­ing for the past decade.

He not­ed that dis­placed work­ers re­main cred­i­tors in the liq­ui­da­tion and de­serve clar­i­ty on what the pro­posed in­vest­ment means for their fu­ture.

“There is a liq­ui­da­tion process that has been in ex­is­tence for the past ten years and that is why we are mum. We want to hear the de­tails be­cause there is a liq­ui­da­tion process as it re­lates to the plant, and now we are hear­ing there is an MOU,” Bai­ley said.

He added that the union had not been told who the agree­ment was signed with or what its terms were.