Close to 50% of foundries have closed in the past decade in South Africa, according to some estimates. The Non-ferrous Metal Industries Assn estimates that around 33 aluminium foundries alone have closed since December 2010.
Domestic scrap buyers – mostly foundries – argue that the scrap industry itself has felt few repercussions from these changes.
The foundries argue that the scrap industry is partly responsible for the changes because it has been exporting a lot more scrap, often leaving the domestic market with poorer quality material but at international prices.
The government has now stepped in and will be implementing stricter measures before scrap merchants are given export permits.
Ferrous and non-ferrous scrap must be offered domestically first at a 20% discount to listed prices before an export permit will be issued, according to the directive due to take effect on September 16.
While there is already a directive in...