Many challenges to achieving globally recognized sustainable steel: BIR convention

Achieving globally recognized sustainable steel faces many challenges, according to speakers at the BIR’s World Recycling Convention in Singapore, who highlighted issues around trade policies, energy costs and the need to establish emissions certification and standards, as well as some mills’ reticence to use recycled steel.

Speaking during the Ferrous Division session on Oct. 29, SA Recycling's CEO George Adams said common regulations would be required globally to drive reductions in the steel industry’s carbon footprint, according to a BIR statement on the main points of the session.

Noting that recycling was crucial to lowering emissions, Adams said that on cost grounds it was easier for US steel mills to run iron ore pellets than recycled steel because they are “not as focused on their carbon footprint as they are on their bonuses.”

“It doesn't matter whether it's aluminium or steel or copper, nothing reduces carbon more than recycling. The EU is much more ahead of the US on [regulation] because, at the end of the day, customers are still looking at the cost,” Adams said.

However, Galloo's director of public and regulatory affairs Emmanuel Katrakis said the US was ahead of the EU because 70% of the steel it makes is produced in electric arc furnaces.

He said a major issue in the EU was the energy crisis because of the Ukraine war, which had led to its energy prices decoupling from the rest of the world, while the US had also implemented the Inflation Reduction Act in 2022 offering subsidies for decarbonization.

“Big players in Europe invested in decarbonization, not in Europe but in the US because of that financial stimulus.”

Inconsistent enforcement of legislation

EMR's director of sustainability Patrick Davison said that, while many people bemoaned regulations, his main concern was inconsistent enforcement of legislation.

“We need to get reasonably comfortable with a little bit of self-policing. What I'm talking about is collaborating, so we understand what the challenges are, and as a sector, we are very clear and consistent about what we think green steel is.”

Davison said sustainability is a challenging and complex area and questioned whether blast furnaces could ever be green.

“They are claiming to have high volume material, high quality materials but actually we have a significant environmental footprint associated with the manufacture of materials from there,” he said.

Davison noted that around a third of end-of-life vehicles in Europe were lost from the wider European market, but EMR, which supplies material to recyclers at end-of-life and is a potential recipient of recyclers’ secondary products, wants to hold on to that material to process it further.

“If we have a larger volume of material, we can spread our investment costs, our R&D costs, around further processing to increase the quality of the materials that we've got,” he said.

“Maybe we will start selling these materials on the basis of a melt package, so we can actually set the chemistry of the materials... so it's a very specific product quality that we're achieving in that process. We're already working with automotive [OEMs] in relation to the design of their vehicles, ready for recycling,” Davison said.

Sustainability

The Global Steel Climate Council's executive director Adina Renee Adler said the term “green steel” was an ill-defined concept and, for her, sustainability was about standards and targets while a key measure was the emissions intensity of steel products.

She said demand for standards was being driven by climate agreements, policies such as the European Green Deal and pressure from customers, consumers and investors.

Adler told the conference that data on emissions should be collected throughout the supply chain, with demand for such data coming from customers and investors.

However, Adams said scrap should simply be counted as having zero emissions.

“Some scrap won't get recycled -- stuff that's too far away. You'll say: ‘Oh, that's too big a carbon footprint’.”

He was also concerned such data reporting would be too much for smaller traders.

Mellor Metals' managing director Shane Mellor agreed saying, “a product comes to the end of its life when it enters the recycling facility. You're at zero at that point.”

Platts, part of S&P Global Commodity Insights, assessed the daily Northwest Europe HRC carbon-accounted steel price at Eur625/mt Oct. 29, down 21% since the start of 2024.