Steel in circular economy and the importance of recycling steel

Mar 11, 2021

A sustainable circular economy means that the society aims to reduce the burden of nature by making sure that the resources remain in use for as long as possible. The role of steel in the circular economy is considered as it is a permanent material. Steel is used in many different applications and steel components can be efficiently reused, remanufactured, or recycled. (World Steel Association 2018)

In today’s society, steel is an important material and is used in transportation, infrastructure, manufacturing, and energy production. Steel is often chosen as the material because of its durability and long lifetime. Steel used for different applications can always be recycled and/or reused at the end of its life cycle. Indeed, the circular economy involves much more than recycling steel components. In fact, an object is only recycled once it has reached the end of its life. Prior to this, the steel objects can be reused without physical modifications. The steel objects can also be remanufactured, in which case they will be returned to brand new condition. However, the circular economy is based on a reduction in steel applications. These processes are described in more detail in the following chapters. (Steven et al. 2017)

1,768 Mt of steel was used in 2019. Most of this steel, 52%, was used for buildings and infrastructure. These applications have a long service life, which means that the steel does not return to circulation quickly. The second-largest sectors were mechanical equipment (16%) and automotive (12%) which belong to a sector with medium service life. 10% of the steel was used in metal products, such as steel jars and cans. This sector includes both medium service life and short service life products, i.e., steel returns to circulation very quickly. (World Steel Association 2018)

Figure 1. Distribution of steel use in 2019 (Amended from World Steel Association 2018).

The sustainable circular economy has a major environmental impact; therefore, its development is important. This article discusses the various aspects of the circular economy as well as the importance of steel scrap recycling.

Reduce in steel applications

Reduction is a key factor in the circular economy. By reducing the weight of the steel products, it is possible to reduce the material used for them. Through research, technology, and good design, steelmakers have been able to significantly reduce the raw materials and energy used in steel over the past 50 years. New steel grades are also being developed that can be used in high-strength applications. They can be used to build lighter structures, such as wind turbines or automobiles because less steel is needed to achieve the same strength and functionality. (Steven et al. 2017) These steel grades have been able to reduce the weight of several steel applications by up to 40%. (World Steel Association 2018)

Weight reduction also has other benefits than reduced use of raw materials. The benefits come from, for example, a reduction in traffic emissions when vehicles are lighter. Energy use has also decreased. As a result of these benefits mentioned above, CO2 emissions have also been reduced. Research and development of light and durable steel grades also create new jobs in the sector. (World Steel Association 2018)

Use and reuse

Reuse means that an object or material is used again for its original purpose or for a similar purpose without significantly altering the physical form of the object or material.

Due to its durability, steel can be reused even without remanufacturing. This is already happening in vehicle parts, buildings, railway tracks, and many other applications. For example, a high-speed railway track can be reused as a low-speed railway track. One of the advantages of steel is that its reuse is not limited to its original purpose. (Steven et al. 2017) In order to achieve a complete circular economy, products must be designed in a way that they can be reused. This enables small and large products to be reused quickly and efficiently after the original purpose has been fulfilled. (World Steel Association 2018)


Remanufacturing means restoring a durable used steel item to a brand-new condition. Most steel products, such as car engines and wind turbines, can be remanufactured for reuse by leveraging the durability of steel parts. (World Steel Association 2015)

The benefits of remanufacturing include, for example, a significant increase in return on investment, it is up to 25 to 50% cheaper for the customer, it can save up to 80% on energy, and the conservation of raw materials is substantial. (World Steel Association 2018)

Recycling of steel and the growing demand of steel scrap

Steel products can be melted at the end of their service life to make new products. Steel is a 100% recyclable material and can be recycled repeatedly to make new steel products. The quality of steel scrap affects what new applications it can be used for. Due to its magnetic properties, it is easy to recycle and that is one of the reasons why it is the most recyclable material in the world. (World Steel Association 2018)

Yale University recently conducted a life cycle analysis of stainless steel. The study revealed that 85% of stainless steels are recycled at the end of their life. In addition, the study revealed that new stainless steel contains approximately 44% recycled content. As the focus on sustainable circular economy and the need for scrap increase, it is important to make the recycling of steel as efficient as possible. The use of recycled steel makes a major difference in the carbon footprint of steel producers. (Moggridge 2020)

Steel can be produced by integrated route, where steel scrap can technically be used up to 30%. About 70% of the world’s steel is produced by this method. Steel is also produced with the EAF route, where the charge can be 100% steel scrap. EAF steelmaking will increase in the future, but the availability and quality of steel scrap affect the selected steelmaking process. At present, there is not enough steel scrap available to produce all-new steel from it.

The transition to scrap-based EAF production is important due to its lower environmental impact. EAF production has increased in recent decades. However, in recent years, the global share of scrap in metal consumption has declined, largely due to the fragmented and inefficient recycling of steel scrap. A limited amount of steel scrap affects the transition from the BOF route to the EAF process. This transition will accelerate as steel scrap recycling infrastructure develops and becomes more efficient. Thus, the slower development in circular economy in an individual country can affect the global statistics.

The transition from the BOF route to scrap-based EAF production is important as it has much lower environmental impacts. In addition, the electricity required by the EAF can be generated from renewable energy sources and the process can also be optimized to be even more efficient. It is increasingly important to invest in a sustainable circular economy and technologies increasing the efficiency to decrease the CO2 emissions but also due to the growing demand for steel scrap.

Luxmet is taking part in the decarbonization challenge of the steel industry. Luxmet’s solution, ArcSpec, helps to optimize the EAF process to make the smelting of steel scrap as environmentally friendly and efficient as possible.

More information about the decarbonization challenge of the steel industry can be found in our previous article series “Pathways to the decarbonization of steel industry”. The first part can be read here. In addition, if you are interested in the rising trends of EAF steelmaking, you can read our article on the subject here.

If you want to know more about our electric arc furnace solution, please do not hesitate to contact us.


Moggridge, M., 2020. New study shows life cycle of stainless steels [online]. Surrey: Steel Times International. Available at: [Accessed 10 March 2021]

Vercammen, S., Chalabyan, A., Ramsbottom, O., Ma, J. and Tsai, C., 2017. The growing importance of steel scrap in China [online]. McKinsey & Company. Available at: [Accessed 4 March 2021]

Worls Steel Association, 2015. Steel in the circular economy [online]. Brussels: World Steel Association. Available at: [Accessed 8 March 2021]

World Steel Association, 2018. Steel – The permanent material in the circular economy [online]. Brussels: World Steel Association. Available at: [Accessed 4 March 2021]