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The steel scrap market size is estimated to grow at a CAGR of 1.62% between 2022 and 2027 with the market size forecast to increase by 62.78 million T.
This steel scrap market report extensively covers market segmentation by End-user (construction, automotive, consumer goods, and industrial goods) and Geography (APAC, Europe, North America, South America, and Middle East and Africa). Our report examines historic data from 2017 to 2021, besides analyzing the current market scenario.
The growth of the market depends on several factors, including the increasing application of steel scrap, the high demand for steel in industrial applications, and the growing demand from the construction industry.
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Steel scraps are discarded steel or steel products that are suitable for melting, generally segregated by composition and size or 'grade'. These steel scraps are recycled and used to make crude steel.
The market share growth by the construction segment will be significant during the forecast period. The construction industry is a major contributor to the growth of the global steel scrap market. The construction of high-rise buildings, tech parks, roads, highways, and bridges globally drives the demand for steel. Owing to its high strength and ductility, steel is extensively used in the construction industry. It is typically used in the manufacturing of beams for structural frameworks, rectangular tubing for welded frames, and high-strength plates for highways and bridges. It is also used in manufacturing rebars and hollow structural sections.
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The construction segment showed a gradual increase in the market share with 291.44 million tons in 2017 and continued to grow by 2021. Moreover, steel is used in handrails, culverts, columns, pilings, fences, caissons, and sign poles. Durability, strength, economical nature, and suitability to long-term exposure to different kinds of weather increase the demand for steel in the construction sector. Moreover, the growing use of steel that is recovered from steel scrap used in the construction industry significantly increases the demand for steel scrap and, in turn, will drive the growth of the steel scrap market during the forecast period. Furthermore, our report provides a brief analysis of the historical and forecast market share and their segments along with the reasons for growth from 2017 to 2027.
APAC is estimated to contribute 66% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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The regional market in focus is poised for significant growth due to the increasing adoption of low-carbon steel manufacturing, particularly using steel scrap. Notable contributions come from India and China. JSW Steel's USD1.26 billion partnership with Germany's SMS group aims to cut emissions by 42% by 2030 through greater steel scrap utilization. Key players like Tata Steel are also driving growth in the Asia-Pacific (APAC) region. Tata Steel's Steel Recycling Business introduced FerroHaat, a groundbreaking mobile app, to streamline India's steel scrap market.
In APAC, the demand for steel is rising steadily, driven by industrialization and infrastructure projects in countries like Indonesia, South Korea, and India. Government initiatives, like India's increased steel scrap imports in H1 2022, will further boost steel and steel scrap demand in the region. Consequently, the growth of steel production from scrap will be a significant driver in the regional market during the forecast period.
The primary driver of global steel scrap market growth is the expanding range of applications for this resource. Worldwide, there is a growing trend toward utilizing recycled steel scrap to mitigate carbon emissions. Recycling steel scrap enhances the economic sustainability of the steel industry and curtails its environmental impact by reducing the reliance on iron ore extraction for steel manufacturing. This substantial reduction in CO2 emissions, along with decreased energy and water consumption and reduced air pollution, is noteworthy.
Each metric ton of scrap steel saves an average of 2.9 metric tons of CO2, rendering steel scrap a favored raw material among steel producers. It can be employed independently or in conjunction with other raw materials like iron ore for steel production. The demand for steel scrap is heavily influenced by the fluctuating prices of iron ore. Consequently, manufacturers are increasingly turning to steel scrap as a primary raw material to cut overall production costs. Therefore, the growing utilization of steel scrap for manufacturing steel products is poised to fuel market growth in the forecast period.
The increase in M&A activities will fuel the global steel scrap market growth. The growing focus on producing steel from steel scrap has been leading vendors to adopt strategies to gain competitive advantages in the market. For instance, In September 2022, Commercial Metals Co. acquired Advanced Steel Recovery, LLC (ASR), a leading supplier of recycled ferrous metals located in Southern California, as part of its strategic expansion in the Western US. ASR handles approximately 300,000 tons of scrap, including steel scrap, annually across its processing, brokerage platforms, and industrial collection points.
In March 2022, ArcelorMittal acquired John Lawrie Metals Ltd., a Scottish recycling business. It is a part of the company's strategy to increase the use of scrap steel and lower CO2 emissions in steelmaking. Thus, the increasing M&A activities will drive the growth of the market to focus during the forecast period.
The complexities in sorting steel scrap and the presence of impurities in steel scrap are major challenges to the global steel scrap market growth. The recycling of steel scrap involves the sorting of steel from other products, including waste materials, which must be then melted and cleaned. The sorting process is not only time-consuming but also expensive. The process of steel scrap recycling creates or leads to impurities in the product. The purification of the metal requires the use of new and advanced technologies. Although the process of recycling consumes low energy, it still uses energy and is expensive at times.
In this growing digital age, the complexity of various modern products that provide steel scrap, such as End-of-Life Vehicles (ELVs), makes recycling more complicated than it used to be. Steel scrap quality is a limiting factor for the increased use of steel scrap due to the presence of impurities in it. A lower steel scrap quality lowers the yield and thus requires higher energy per ton of desired output. Thus, the above-mentioned factors will negatively impact the growth of the market in focus during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
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The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Ansteel Group Corp. Ltd., ArcelorMittal SA, Baosteel Group Corp., Benxi Steel Group Co. Ltd., China Baowu Steel Group Corp., Commercial Metals Co., EVRAZ Plc, Gerdau SA, JSW STEEL Ltd., Metalico Inc., Metinvest B.V, Nippon Steel Corp., Nucor Corp., Oryx Stainless AG, Schnitzer Steel Industries Inc., Sims Ltd., Steel and Scrap Pvt. Ltd., Steel Dynamics Inc., Tata Steel Ltd., and United States Steel Corp.
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Steel Scrap Market Customer Landscape
In 2020, the market in focus faced a setback due to the COVID-19 pandemic, which led to reduced demand for steel products from key sectors in APAC like oil and gas, construction, and automotive. For instance, China saw a more than 40% drop in automotive sales in Q1 2020 compared to Q1 2019. Lockdown measures implemented by governments hindered the movement of both vehicles and people, impacting the import and export of steel products in the region. However, APAC began to recover in 2021 with widespread vaccination efforts and the easing of lockdowns.
Steel Scrap Market Scope |
|
Report Coverage |
Details |
Page number |
176 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 1.62% |
Market growth 2023-2027 |
62.78 MT |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
0.9 |
Regional analysis |
APAC, Europe, North America, South America, and Middle East and Africa |
Performing market contribution |
APAC at 66% |
Key countries |
US, China, India, Japan, and Russia |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Ansteel Group Corp. Ltd., ArcelorMittal SA, Baosteel Group Corp., Benxi Steel Group Co. Ltd., China Baowu Steel Group Corp., Commercial Metals Co., EVRAZ Plc, Gerdau SA, JSW STEEL Ltd., Metalico Inc., Metinvest B.V, Nippon Steel Corp., Nucor Corp., Oryx Stainless AG, Schnitzer Steel Industries Inc., Sims Ltd., Steel and Scrap Pvt. Ltd., Steel Dynamics Inc., Tata Steel Ltd., and United States Steel Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Source
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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