Steel companies investing in ferrous scrap suppliers, seeking to utilise more scrap and alternative metallics to reduce carbon emissions in steel production, continues to gain ground.

Global steel and mining group ArcelorMittal has said it had acquired several German steel scrap recycling businesses from Alba International Recycling, building on the acquisition of scrap merchant John Lawrie Metals in Scotland in March 2022.

Steel producers Cleveland-Cliffs and BlueScope have each acquired scrap businesses in the US Midwest in the last few months, counting on synergies with their steel production plants.

Hedging scrap grades and costs with alternative supplies against stronger interest in low-emissions steel production and certification has taken hold on both sides of the Atlantic.

The acquisitions in Germany follow ArcelorMittal’s stated objective to increase use of scrap steel, both in the electric arc furnace as well as adding more low-quality scrap in the blast furnace-basic oxygen furnace (BOF) steelmaking process.

Steel and metal processing at Alba International Recycling

The company, along with other steel industry groups, sees potential for maximising scrap feedstocks further in the basic oxygen furnace process, which is used by the majority of flat steel producers in Europe, by improving steel scrap sorting and classification, installing scrap pre-melting technology and adjusting the steelmaking process to accommodate scrap.

Cleveland-Cliffs seeks to maximise scrap supplies with its hot-briquetted iron, and iron ore pellets, with the flexibility to shape costs for the sector and maximise efficiencies and emissions across its mining and steel production plants.

Currently, BOF processes in Europe use at most 15% to 20% scrap, as producers cite inefficiencies to go beyond target ratios based on the purity of scrap grades available and need for pre-heating the scrap.

A certain volume of scrap is considered suitable for mixing with liquid pig iron, or hot metal, in the cooling process when the steel specification is formed, with any additional scrap leading to energy costs and production losses.

ArcelorMittal said it acquired 10 scrap yards in the south of Germany, across three different companies, ALBA Electronics Recycling, ALBA Metall Süd Rhein-Main and ALBA Metall Süd, which process about 400 000 mt/year of materials, majority being steel scrap.

The deal, with no amount disclosed, was signed early May 2022 and is due to close with customary regulatory approvals in the coming months, the Luxembourg-based steel company said on its website May 11.

“The companies source material from a broad range of suppliers, contracts with municipalities and via contracts with industrial clients from a range of manufacturing sectors,” ArcelorMittal said in a statement. “The companies ship processed metal scrap and other materials to metal producers and other participants in the circular economy.”

Increasing scrap in steelmaking operations and securing access to metallics required for low-carbon steelmaking is one part of the group’s plans to reduce CO2 equivalent emissions intensity by 35% by 2030, ArcelorMittal Europe CEO Geert Van Poelvoorde said in the statement.