Will the US run out of steel scrap? Report

Insight 24 April 2015

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Report summary

Apart from the recent boom years, the rewards for converting iron, coal and scrap into commodity grade steel have been limited. Since 2009, when demand collapsed and mills outside of China became raw material price takers, profitability has come under pressure once again and steelmakers have been forced to reconsider their strategy for survival. This had awakened a somewhat forgotten debate on making steel via electric arc furnaces versus basic oxygen furnaces...

Executive summary
Demand
Supply
- Home scrap
- Prompt scrap
- Obsolete scrap
Total scrap supply
How scrap demand compares to supply

Tables and charts

This report includes 12 images and tables including:

US Steel profitability is highly volatile
Nucor achieves higher and more stable margins
The EAF share of steelmaking will rise as more flexible electric furnaces replace the large-scale, capital-intensive blast furnaces and oxygen converters

The majority of scrap is consumed in EAF steelmaking, with more than a 1,000 kg of scrap used for each tonne of steel made
Sources of steel scrap
Estimated scrap supply by source
Scrap supply that is not consumed domestically is exported
Scrap supply will be sufficient to accommodate rising scrap demand over the next 20 years
Relative sector sizes have changed drastically since the 1900s
Since the 1990s, the US has been a significant net-importer of vehicles
A longer lifecycle delays the impact of demand fall during the 90s and the GFC
Indirect steel imports have a major impact on obsolete scrap supply