- Recycled steel consumption shows decline across major regions
- Turkiye remains No.1 scrap importer, but volumes fall 12% y-o-y
The July 2025 BIR World Mirror painted a bleak picture for the global ferrous scrap market, with mills hit by high input costs, weak demand, and currency swings. It reinforced recycled steel’s importance in decarbonisation, citing up to 80% lower emissions than blast furnace routes.
World steel recycling update: Q1 2025
Global crude steel production reached 468.6 million tonnes (mnt) in Q1 2025, slipping 0.4% y-o-y, according to worldsteel. Output rose in Africa (+1.4%), Asia/Oceania (+0.5%), and South America (+0.5%), while the EU-27 (-2.5%), Other Europe (-8.1%), CIS (-2.6%), and the Middle East (-8%) all saw declines. North America held flat at 26.9 mnt. Asia/Oceania remained the top producer, accounting for 348.8 mnt.
BIR emphasised the use of “recycled steel” to better align with sustainability narratives, estimating global recycled steel use at 630 mint annually, preventing 950 mnt of CO₂ emissions.
Regional usage trends
Recycled steel consumption fell across most major producers, with China down 1.6% to 57.62 mnt despite a 0.6% rise in crude steel production. The EU-27 posted a 7.1% drop in usage to 19.05 mnt, while production declined just 2.5%. The US saw recycled steel usage fall 14.9% to 13.02 mnt, though output dipped only 0.6%. Japan and South Korea reported sharper drops in scrap use than crude steel output, while India was a bright spot–usage surged 19.1% to 10.06 mnt alongside a 6.8% rise in production.
Trade flow
Turkiye’s recycled steel imports fell 11.5% y-o-y to 4.72 mnt but remained the world’s largest importer. Main suppliers included the Netherlands, the US, and the UK. India ranked second with 2.28 mnt (-0.4%). The EU-27 led exports at 4.58 mnt (+4%), primarily to Turkiye, Egypt, and India. US exports dropped 12.3% to 2.93 mnt. Export volumes rose from Japan, the UK, Australia, and Mexico but declined in Canada and Hong Kong.
US and EU scrap export prices moved largely in parallel during Q1.
European market updates
Despite a modest 0.4% GDP rise in Q1, Germany’s steel sector continues to falter. Crude steel output dropped 11% y-o-y in January-May, and recycled steel prices weakened in Q2 under the weight of a strong euro, soft domestic demand, and sluggish exports. Meanwhile, blast furnace production slumped 13%, and recyclers face high collection costs with little margin relief.
In Scandinavia, the summer lull and geopolitical tensions have trimmed scrap trade volumes. Turkish HMS remains steady at $340–345/t, but a softening dollar has chipped away at EU supplier margins. The UK tells a similar tale—muted Turkish demand, volatile foreign exchange, and limited container space have kept market sentiment low, even as dockside prices ticked up. Supply tightness persists, with shredders operating at just 60% capacity.
US market updates
US recycled steel prices remained flat in July after correcting nearly $80/t in April-May. Despite decent mill demand and stable capacity utilisation near 80%, ample scrap supply and weak exports to Turkey, Taiwan, and Mexico kept prices capped.
June saw no significant drop in flows, which limited dealers’ chances for a July price hike. While HRC prices rebounded to $900/t following the Trump administration’s hike in steel tariffs to 50%, downstream demand remains cautious. Mills wrapped up July trade quickly, with most deals concluded pre-4 July.
Asian market updates
China‘s steel juggernaut showed no signs of slowing, with finished steel exports reaching 48.47 mnt in January-May — up 8.9% y-o-y. Over 60% of Chinese mills were profitable in May despite a 1.7% y-o-y dip in crude steel output. Oversupply fears linger, though Beijing is reportedly weighing fresh output curbs.
In Korea and Taiwan, mills are under pressure. Korean crude steel production slipped 3% y-o-y, while Taiwanese recycled steel imports plunged 50% in May amid tepid demand and cheap billet alternatives.
Southeast Asia’s appetite remained steady but unremarkable, with import volumes in Thailand, Vietnam, Indonesia, and Malaysia mostly flat, driven by containerised trades.
Bangladesh continues to favour Japanese shredded, lured by flexible shipments and quick turnarounds. Imports surged 270% y-o-y, though looming tax hikes and currency instability may dampen enthusiasm.
India remains resilient. Crude steel output climbed 9.7% y-o-y in May, even as monsoon rains and tight liquidity weighed on scrap demand. Import volumes fell sharply following safeguard duties, especially from China, protecting local mills from pricing volatility.
Japan‘s market stayed stable, with prices hovering above ¥40,000/t. Despite reduced domestic generation and weaker global sentiment, scrap exports in May hit 648,253 t—up 24.6% y-o-y—driven by a 72.7% surge in Vietnamese demand. Crude steel output, however, slipped 4.7% y-o-y.
Africa
South Africa‘s Steel Master Plan (SMP) was designed to protect local mills and boost beneficiation–but has largely stalled. Export controls meant to ensure affordable domestic scrap have disrupted flows and undermined collector incentives, while policy inconsistencies have eroded industry trust.
Calls for reform are growing louder. Industry stakeholders are pushing for a more flexible, targeted approach that balances local supply with market incentives. For now, the recycled steel sector remains hampered by low confidence and regulatory drag.
Middle East
The GCC remains a rare bright spot. Steel demand is surging in the UAE, Saudi Arabia, and Kuwait, fuelled by infrastructure, oil and gas, and real estate development. Long products — especially rebar — continue to lead demand.
While scrap remains tight, local capacity is rising. The UAE’s green shipbreaking initiative aims to add 750,000 t/y by 2027, helping feed growing EAF and IF capacity across the region. With scrap exports restricted, Gulf mills rely heavily on domestic supply, pricing off Turkish benchmarks.
Regional steelmakers are ramping up capacities. Firms such as Emirates Steel, Arabian Gulf Steel Industries, and Al-Qaryan Steel (with its newly completed 150,000 t/y IF) are scaling up production, reflecting a strategic shift toward green steel pathways and circularity. Bahrain’s Pellet Plant and similar initiatives are supporting this shift, expanding upstream raw material availability.
Environmental rules are also evolving, with the UAE aligning steel recycling norms with EU standards to support cleaner, circular steelmaking.
Outlook
Global scrap markets remain weighed down by regional imbalances. Europe faces supply constraints from logistics and customs delays, with UK shredders operating at just 60% capacity. In Asia, oversupply and weak steel prices in Korea and Taiwan are limiting demand, while China’s export push pressures regional players. India and Vietnam, however, are ramping up domestic scrap processing.
In the US, tight summer supply may offer mild support, but weak demand and low export activity will likely cap gains. With the 90-day trade reprieve ending in August, market sentiment remains cautious. BIR’s renewed call for emission-based steelmaking standards underlines a longer-term shift toward greener production.
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