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Nigeria Spends $4 billion annually on the importation of Steel and metal products.
Est. Imported Metal products market size
Steel products
Others
20%
80%
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Steel Products - $3.2 Billion
Others - $0.8 Billion
Industry Trends:
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Advent of the Automobile assembly industry will stimulate demand as regards
fabrication of automobile parts.
Consistent growth in the Construction Industry stimulating a boost in demand for
building rods and wiring needs.
Local content promotion in the Oil & Gas industry stimulating boost in demand
indigenously for sheet metals and other related metal products. (picture of O & G)
Urbanisation & development stimulating increase for alloy ingots for utilization in
metal parts manufacturing.
Market Challenges
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Efficient logistics and transportation of scrap to mills.
Innovative solutions
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Partnership with LAWMA (Lagos state waste management) for supply of certain
tonnage of waste scraps metal on an MOU / LPO Basis.
“Austempering” – Is the toughening & strengthening of recycled metal so as to be
used for specialised services such as production of shafts and gears, instead of
limiting oneself to the production of iron rods and plates.
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Most Scrap metal recycling plants in the country are run by Indian & Chinese
expatriates
(Chinese Owned Strip of companies along Ikeja/Mile 2/Ikorodu; Hundreds of Trucks
of scrap make deliveries every week)
1 is European (www.reukama.com)
The rest are Nigerian
CASE STUDY: Sea Vessel Scrapping
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Sea vessels over 25 years are recommended to be scrapped (Over 80% of tanker
vessels in Nigeria are single hull which have been phased out of the international
community)
Ship wreckage, Abandoned ships are abundant sources of scrap metal.
The Nigerian Maritime Administration & safety Agency (NIMASA) is urging
investors to invest in ship scrapping & recycling.
NIMASA set a deadline of 2020, for sea vessel owners with derelict ships to clear
their waste.
The ENL Consortium ltd managing a few terminals in Lagos ports complex complains
incessantly about the nuisance of vessel abandonment
In “Ilashe”, Lagos, few ship breaking operations take place, but are negligible in value
An estimated 100 rusty ship wrecks line the Nigerian shore.
From International statistics it costs between $4.0 – $6.0 million dollars to scrap a
ship.
Turkey, Pakistan, Bangladesh and India are major destinations for the scrapping of
ships.
It is estimated that Lagos requires over N25 Billion to remove over 200 ships and is
encouraging ship recycling.
The 3rd largest Ship scrapper in the world is in Pakistan, they turn over 1 million tons
of steel each year.
According to “Lloyd’s list”, Asian Scrap yards Generate $7 billion dollars annually.
In India 9% of steel demand is met by Ship scrapping.
Scrapping of steel demands strict control and HSE precautions as regards handling
some toxic substances such as; Asbestos, Polychlorinated Biphenyls, Carcinogenic
chemicals etc.
Few environmental / Occupational safety regulations & Steel’s high value are the
market drivers behind Asia’s dominance in this sub-segment.