Unclassified DSTI/SU/SC(2012)1/FINAL Organisation de Coopération et de Développement Économiques Organisation for Economic Co-operation and Development 11-Oct-2012 ___________________________________________________________________________________________ English - Or. English DIRECTORATE FOR SCIENCE, TECHNOLOGY AND INDUSTRY STEEL COMMITTEE Unclassified DSTI/SU/SC(2012)1/FINAL STEELMAKING RAW MATERIALS: MARKET AND POLICY DEVELOPMENTS English - Or. English JT03328533 Complete document available on OLIS in its original format This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. DSTI/SU/SC(2012)1/FINAL FOREWORD The attached paper provides a synthesis of work by the OECD Steel Committee on steelmaking raw material issues. This paper reflects comments received by participants of the Committee during the summer of 2012. Please note that, while the Secretariat received comments from China on the contents of the report, the report does not represent China's views nor has China acknowledged the report © OECD/OCDE 2012 Applications for permission to reproduce or translate all or part of this material should be made to: OECD Publications, 2 rue André-Pascal, 75775 Paris, Cedex 16, France; e-mail: [email protected] 2 DSTI/SU/SC(2012)1/FINAL TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................................ 5 PART A. MARKET ISSUES ......................................................................................................................... 8 1. Introduction to steelmaking raw materials .............................................................................................. 8 2. Production and resources of key steelmaking raw materials ................................................................... 9 Iron ore .................................................................................................................................................. 10 Coking coal ............................................................................................................................................ 12 Ferrous scrap .......................................................................................................................................... 13 Other elements used to produce steel .................................................................................................... 14 3. Trade in raw materials ........................................................................................................................... 17 Iron ore .................................................................................................................................................. 17 Coking coal ............................................................................................................................................ 18 Scrap ...................................................................................................................................................... 19 Other elements ....................................................................................................................................... 20 4. Price and market developments ............................................................................................................. 22 Iron ore .................................................................................................................................................. 24 Coking coal and coke ............................................................................................................................. 25 Ferrous scrap .......................................................................................................................................... 27 5. Special focus: The emergence of new price mechanisms ..................................................................... 28 6. How are companies responding to the raw material challenge? ........................................................... 30 Investment in mining and upcoming mining projects: regional perspectives ........................................ 31 Challenges for mining ............................................................................................................................ 35 PART B. GOVERNMENT POLICIES ........................................................................................................ 39 1. Mineral policy trends: An overview ...................................................................................................... 39 2. Short summaries of national policies regarding raw materials .............................................................. 39 United States .......................................................................................................................................... 39 European Union ..................................................................................................................................... 40 Germany ................................................................................................................................................ 41 China ...................................................................................................................................................... 41 India ....................................................................................................................................................... 41 Russia ..................................................................................................................................................... 42 Brazil ..................................................................................................................................................... 43 Japan ...................................................................................................................................................... 43 Korea ..................................................................................................................................................... 43 3. In-depth focus: European mining and raw material policies ................................................................. 43 Raw Materials Initiative 2008 ............................................................................................................... 44 Raw Materials Initiative 2011 ............................................................................................................... 44 Key areas of trade policy in the area of raw materials ........................................................................... 45 African-EU partnership on raw materials .............................................................................................. 46 4. In-depth focus: Chinese mining sector and mineral policy ................................................................... 47 China’s mining resources and spending on exploration activity ........................................................... 47 China’s domestic mining structure ........................................................................................................ 49 China’s mineral resource policy ............................................................................................................ 50 3 DSTI/SU/SC(2012)1/FINAL The global reach of Chinese mining firms ............................................................................................. 52 Despite investment growth abroad, China still has a small share in global metal mining ..................... 53 5. In-depth focus: The Africa Mining Vision ............................................................................................ 54 The Mining Vision’s Action Plan .......................................................................................................... 55 Progress on the Mining Vision Action Plan .......................................................................................... 55 6. Export restrictions on steelmaking raw materials ................................................................................. 56 Use of export restrictions ....................................................................................................................... 56 Impacts of export restrictions ................................................................................................................ 57 Workshops on raw material export restrictions organised by the OECD Trade and Agriculture Directorate ............................................................................................................................................. 58 NOTES .......................................................................................................................................................... 61 BIBLIOGRAPHY ......................................................................................................................................... 63 ANNEX 1: EXPORT DUTIES ON STEEL RAW MATERIALS .............................................................. 65 ANNEX 2: QUANTITATIVE RESTRICTIONS ON STEEL RAW MATERIALS ................................... 68 4 DSTI/SU/SC(2012)1/FINAL EXECUTIVE SUMMARY The objective of this report is to summarise key developments