At the world’s leading trade fair for environmental technologies (IFAT), held in Münich on May 4-7, the BVSE (Federal Association of Secondary Raw Materials and Waste Management) and the BDSV (Federal Association of German Steel Recycling and Waste Management Companies) emphasized in a press release published yesterday, May 4, that the steel and scrap sectors remain under intense pressure due to persistently weak domestic demand. They noted that the German steel industry and its recycling partners are navigating a period of significant contraction, even though recent figures show a marginal uptick in steel production.
2025 represented a historical low point for German steelmakers, with crude steel production falling “by 8.6 percent to just 34.1 million tons”, the press release reports. This marks the fourth time since 2018 that output has failed to reach the 40 million mt threshold, which industry leaders like WV Stahl CEO Kerstin Maria Rippel identify as necessary for sustainable capacity utilization, as SteelOrbis already reported.
German crude steel output in 2025 and its impact on scrap usage
Even though crude steel production in the first quarter of 2026 rose by nine percent year on year to 9.26 million mt, analysts warn this does not signal a genuine recovery. Structurally, steel consumption in Germany has plummeted by approximately 30 percent (12 million mt) since 2017, driven by the continued underperformance of critical sectors like automotive and mechanical engineering.
The downturn in crude steel production has directly impacted the steel recycling industry. In 2025, German steel mills’ scrap purchases fell by 5.3 percent, totaling only 12.0 million tons. However, the share of scrap in total crude steel production increased to 46.2 percent.
According to the joint statement, the resulting surplus has forced a shift in trade dynamics, as Germany’s scrap exports rose by 5.3 percent to 7.7 million mt, while scrap imports fell by 9.4 percent to 3.9 million mt.
The BVSE and BDSV explain that the net scrap export surplus of 3.7 million mt is the "inevitable consequence of weak domestic demand". For the recycling industry, particularly small and medium-sized enterprises (SMEs), access to international markets has become an "indispensable outlet" to maintain the infrastructure for collection and processing within Germany.
A notable trend in the 2025 data is the relative resilience of the electric steel production route compared to traditional blast furnaces. While conventional production saw a 10.7 percent decline, the scrap-based electric steel production route fell by a more moderate 3.5 percent, both year on year. Consequently, the share of electric steel production of steel total production rose to 30.6 percent, and the overall share of scrap in crude steel production increased to 46.2 percent. This highlights the growing importance of recycling even as the broader market contracts.
External factors weighing on outlook of German steel and scrap segments
The outlook for both markets is clouded by several external factors:
- Global overcapacity: projections suggest global overcapacity could exceed 700 million mt by 2027, intensifying import pressure on German producers.
- Energy costs: the industry continues to lobby for a competitive industrial electricity price of €50/MWh to restore global competitiveness and support the transition to green steel.
- Lead markets: associations are calling for the development of "lead markets" for low-emission steel, utilizing public procurement to stimulate demand for sustainable products.
So, while the steel recycling sector remains a vital pillar of the German circular economy, its health is closely linked to a weak domestic steel industry currently hampered by structural demand deficits and high operational costs.
| Scrap balance - Germany | 2025 (000/mt) | 2024 (000/mt) | Δ in % |
| Scrap trade | |||
| Steel mills’ purchases* | 12,025 | 12,692 | -5.3 |
| Foundries’ purchases* | 2,120 | 2,410 | -12.0 |
| Exports | 7,700 | 7,314 | 5.3 |
| Total shipments | 21,845 | 22,416 | -2.5 |
| Imports | 3,979 | 4,392 | -9.4 |
| Shipments from domestic production | 17,866 | 18,024 | -0.9 |
| Production | |||
| Total crude steel production | 34,090 | 37,310 | -8.6 |
| Blast furnace production | 23,645 | 26,487 | -10.7 |
| Electric arc furnace production | 10,445 | 10,823 | -3.5 |
| Electric arc furnace share in % | 30,6% | 29,0% | |
| Iron, steel and malleable cast iron castings | 2,400 | 2,600 | -7.7 |
| Pig iron production | 21,874 | 24,327 | -10.1 |
| Scrap share in crude steel production in % | 46,2% | 44,5% | |
| Scrap consumption | |||
| Total crude steel* | 15,745 | 16,606 | -5.2 |
| Iron, steel and malleable cast iron castings* | 3,360 | 3,650 | -7.9 |
| Total scrap consumption | 19,105 | 20,256 | -5.7 |
*BVSE, BDSV (provisional) estimates, personal calculations. Updated on 24.04.2026.