BDSV says study shows economic viability of scrap

German steel scrap association says use of ferrous scrap saves “billions in climate and environmental costs.”

The Germany-based Bundesvereinigung Deutscher Stahlrecycling- und Entsorgungsunternehmen (BDSV) says a study it recently commissioned has found that “scrap is a key raw material for steel production, not only in Germany, and [it] contributes significantly to the reduction of emissions.”

The study, undertaken by Germany’s Fraunhofer Center for Economics of Materials (CEM), is titled “Scrap Bonus: External Costs and Fair Competition in the Global Value Chains of Steelmaking.”

According to BDSV, the study shows the use of steel scrap in Europe reduces the costs of climate change by up to 20 billion euros ($21.7 billion) per year. Ferrous scrap as feedstock saves CO2 emissions compared with the production of steel from ores and refined mining products and reduces other environmental damages, “such as acidification of water, summer smog or eutrophication,” says BDSV.

An indicator BDSV calls the “scrap bonus” measures the climate and environmental costs that are avoided by using each ton of scrap in steel production. The study suggests this scrap bonus should be incorporated in the overall steel market’s price mechanism.

Adds BDSV, “The scientists concluded that using one ton of recycled stainless steel scrap saves 4.3 tons of CO2 in stainless steel production [and with] carbon steel the average saving of using one metric ton of ferrous scrap is 1.67 tons of CO2.”

The organization continues equates the CO2, savings of using a ton of carbon steel scrap as identical to preventing the emissions of a typical internal combustion engine car driving 9,000 kilometers (5,590 miles).

“The research team calculated that the scrap bonus is between 79 euros and 213 euros ($86 to $231) per ton of carbon steel scrap” and has an even higher value in the stainless sector. The study takes into consideration the global average of emissions avoided during the production of steel along the value chain, from the extraction, production and use of raw materials to the use of energy sources and the recycling of residues, says BDSV.

“The study strongly contributes to raising awareness of the importance of scrap as a raw material for steel production,” says Dr. Frank Pothen, head of the CEM and a co-author of the study. “Steel recycling is an integral part of a circular economy. [and] the use of high-quality scrap is an expression of economically and ecologically sustainable steel production.”

Comments BDSV President Andreas Schwenter, “The insights gained through the study underline the importance of steel recycling and show how it can be strengthened, quantitatively and qualitatively, primarily through research and development, with a focus on medium-sized companies.  For us, the scrap bonus is a bonus for scrap.”

A downloadable version of the full study, in English, can be found on this web page.