The government of Sri Lanka has banned the export of all major scrap metals such as iron and steel, aluminum, copper, and zinc.
According to media reports on Nov 15, the industrial cabinet of the South Asian country made the decision to increase scrap supply in the domestic market. The government intends to effectively subsidize the cost of scrap by depriving scrapyards of international margins.
However, market participants believe that this move, which will lower the price of scrap metal in the domestic market, will in turn lower the collection rate due to lower profit margins. As a result, industry sources said that the plan to make more scrap available to domestic mills will be defeated.