US-based management consulting company Boston Consulting Group (BCG) has stated that the global supply of scrap is in a losing battle against demand growth. According to BCG’s analysis, global scrap demand will increase by about 3.3 percent over the next eight years, while supply will rise by only about three percent. The company stated that today’s global nine million mt scrap surplus could become a 15 million mt deficit by 2030 as more producers shift to electric arc furnace-based steelmaking, which uses recycled steel scrap, to meet decarbonization goals.
According to BCG, by volume, scrap will account for 50 percent of the global iron content in steel by 2030, up from the current 35 percent. By that point, annual scrap consumption in both China and the US will likely be 40-50 percent higher than today, much of it to make more steel. BCG anticipates that the global scrap trade will decline by about 15 percent to around 93 million metric tons by 2030 as scrap availability tightens through the decade. The company stated that policymakers must explore ways to handle scrap scarcity, especially since a thriving domestic steel industry is essential to other critical sectors and global economic competitiveness.
