Conflict Minerals Compliance: Steel and US Service Centers

- February 28, 2013 9:13 AM
Categories: Procurement Research | Tags: , , , ,

This post is based on excerpts from the MetalMiner (part of the Spend Matters Network) paper: The Definitive Guide to Conflict Minerals Compliance for Manufacturers: An A–Z Guide to Conflict Minerals and Semi-Finished Metals. Spend Matters PRO Subscribers can also click to read two more detailed technology analyses on conflict minerals compliance strategy here and here.

The US steel and service center market has its own unique challenges surrounding conflict minerals compliance. Companies who must document compliance in their supply chains need to ask their suppliers the following questions:

First, how will US service centers specifically address conflict minerals compliance, given that they both import and stock materials from [potentially] non-compliant and/or unknown global sources such as trading companies where limited mill information exists? Do service centers even sell products that put them in a position to have to comply with this?

Second, as many of them do not technically fall under Dodd-Frank rules, will non-US public producers such as those from Russia, India, China, Japan and Korea apply the same rigor, honesty and systematic approach to this issue as US producers and other globally traded public US companies?

We believe many of the larger producers with substantial sales and volume into the US market will provide conflict minerals information in support of requests from customers. But the path does not appear as straightforward as one might expect.

One major tinplate producer had a conflict minerals disclaimer on its website stating they don’t produce any products containing cassiterite. Although the producer has addressed the conflict minerals issue for tinplate, the disclaimer raises questions for their non-tinplate sheet customers. Buying organizations will need to pay special attention to what companies disclose, publicly or otherwise.

Furthermore, at the time of writing, only three tin smelters globally had obtained CFS designation, representing less than 30% of global tin production. Given this low percentage, one might question the validity of any statements made to date concerning the conflict-free status of tin products, and how the company came to that conclusion.

This post is based on excerpts from the MetalMiner (part of the Spend Matters Network) paper: The Definitive Guide to Conflict Minerals Compliance for Manufacturers: An A–Z Guide to Conflict Minerals and Semi-Finished Metals. Spend Matters PRO Subscribers can also click to read two more detailed technology analyses on conflict minerals compliance strategy here and here.

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