HAMBURG, Aug 25 (Reuters) - Germany faces a commodity supply gap partly because trade distortions promoted exports of raw materials from Europe such as scrap metal, the association of German industry BDI said on Tuesday.
"We are steering towards a raw materials gap," said Ulrich Grillo, chairman of the BDI commodities group and chief executive of German zinc producer Grillo-Werke.
"Global, European and national restrictions to commodities are threatening the growth of German industry, which is vital to overcoming the current crisis."
China alone restricted trade with raw materials and semi-finished products with some 373 export duties, he said in a statement. These especially distorted supplies of copper and the metal neodymium, used for laser equipment.
China planned to refund value added tax on imports of scrap metal from 2010, he said. When China made such refunds in the past they had a "vacuum cleaner impact on the scrap market and sucked the world scrap metal market empty."
Germany needed such scrap metal as about 50 percent of German metal production involved scrap, he said.
European exports of secondary raw materials had risen strongly in past years, he said.
"Such exports are often illegal," he said. "Waste is often exported as usable goods or false declarations of material type are made."
"The central problem is the boundary between waste and usable products."
Under half the automobiles sent for scrap in Germany were recycled into metal, he said. He estimated that 40 percent of German automobiles sent for scrap were sent abroad without notification as exports.
German industry was also worried about the increasing
concentration of global commodities supplies in the hands of a
small number of powerful companies, such as the iron ore joint
venture formed in June by mining giants Rio Tinto
There was also concern about increasing Chinese purchases of shareholdings in nickel mines in Canada and South America.
Grillo called for greater political attention to European commodity supplies. Germany and the European Union should develop a unified commodities strategy involving more energetic action to tackle international trade distortions which disrupt commodity trade.
(Reporting by Michael Hogan; Editing by William Hardy)