Scrap

Steel scrap

Scrap: A silver bullet for decarbonisation?

Steel is theoretically infinitely recyclable, and using recycled steel, or scrap steel, is one of the most direct ways to reduce emissions from steelmaking. Scrap is primarily melted in Electric Arc Furnaces (EAFs), which can operate on up to 100% scrap, but it is also used in smaller quantities in Blast Furnaces (BFs) to lower emissions and improve efficiency.

Since the first commercial EAF was built in 1906, demand for scrap has grown. Understanding the limits of scrap availability is critical to effectively driving decarbonisation at a global level.

The scrap quandary

Despite a global steel recycling rate of around 85%, today’s scrap supply can meet only about 32% of global demand for new steel. This is largely due to the gap between historical steel consumption and current steel demand.

On average, steel remains in use for around 35 years across infrastructure, buildings, transport and packaging. As a result, the amount of post-consumer scrap available today is largely determined by how much steel was produced three to four decades ago, and steel demand has increased significantly since then. In 1989, global steel production stood at approximately 0.78 billion tonnes, while in 2024, it had reached 1.9 billion tonnes.

Although scrap availability will increase as today’s steel products eventually reach the end of their lifecycle, global demand for steel is also expected to rise. The International Energy Agency (IEA) projects that even in its Sustainable Development Scenario—which assumes strong improvements in material efficiency—scrap will meet only around 46% of global demand for new steel by 2050. This means that the steel industry cannot rely on scrap alone to lower emissions, primary production routes will also need to be decarbonised.

Read more about the history of scrap in steelmaking and its role in driving decarbonisation here.

Steel scrap in numbers

Understanding scrap, or recycled steel, availability is key to decarbonising steel. These figures show the role scrap can play in reducing emissions and the limits to meeting global steel demand.

According to EuRIC, scrap can effectively reduce a steelmaker’s direct (Scope 1) emissions by up to 58%.

According to the World Steel Association, 85% of steel is estimated to be recycled globally.

According to the International Energy Agency (IEA), 46% of steel demand will be able to be met by scrap by 2050.

yrs

35 years is the average lifespan of a steel product.

According to the International Energy Agency (IEA), 32% of steel demand can currently be met with scrap.

Large piles of shiny crushed and shredded metal scrap under a clear blue sky.

Adopting a scrap variable approach

To avoid a race for a limited supply of scrap and the risk of carbon leakage, the steel sector needs a pragmatic approach to decarbonisation. One that recognises the physical limits of scrap availability, while incentivising real and comparable emissions reductions across all steelmaking routes.

ResponsibleSteel was a pioneer of the scrap-variable approach (also known as a sliding scale). This approach complements traditional carbon footprinting by explicitly accounting for the proportion of scrap and primary iron used in steel production. Recognised by the G7, promoted by the International Energy Agency (IEA), and embedded in international standards, it aims to:

1. Prevent unproductive competition for limited scrap supplies
2. Incentivise decarbonisation across all steel production routes
3. Enable technology-neutral, WTO-compliant solutions

Learn about ResponsibleSteel's Decarbonisation Scale

The Steel Decarbonisation Scale

This joint policy briefing by ResponsibleSteel and the Low Emission Steel Standard (LESS), developed for EU policymakers, sets out the case for adopting a scrap-variable approach to steel decarbonisation.

It calls on policymakers to integrate the Steel Decarbonisation Scale into the design of voluntary labels, lead markets and investment support mechanisms, helping ensure that future measures are effective, fair and aligned with climate ambitions.