A ‘highly volatile’ trading environment has hit the recovery of the recycled steel industry just as it was getting back on its feet, according to the Bureau of International Recycling.
Shane Mellor, president of the BIR’s Ferrous Division, notes the impact of conflict in the Middle East in the latest BIR Mirror, the last before the organisation’s convention in Gothenburg, Sweden in late May.
‘Surging oil and natural gas prices and also rising freight costs and insurance premiums have combined to create a highly volatile trading environment,’ he writes. ‘Rapid shifts in mill purchasing behaviour, changing supply origins and volatility linked to energy and logistics are having immediate implications for exporters and steelmakers worldwide.’
Exposed
Prior to the war, the global recycled steel industry appeared to be stabilising, he notes. Steel production was recovering in certain regions and sentiment had improved following a difficult 2025.
‘However, the first quarter of 2026 quickly reminded us how exposed global markets remain to geopolitical instability, energy disruption, protectionism and economic uncertainty.’Despite the short-term issues, Mellor suggests one question is becoming increasingly important: is recycled steel the strategic driver of the 2050 steel industry?
‘The long-term answer appears increasingly positive. Around 630 million tonnes of recycled steel are used annually in steelmaking, preventing as a conservative estimate some one billion tonnes of CO₂ emissions while saving energy and conserving natural resources. More than ever before, recycled steel is being recognised not simply as a traded raw material but also as an essential strategic input for the future of low-carbon steel production.’
Many challenges
Even so, he warns, the industry must first navigate protectionism, shifting trade dynamics, volatile freight markets, energy cost pressure, restrictive monetary policies and geopolitical risk, all of which are shaping today’s operating environment. ‘As we move further into 2026, uncertainty will likely remain a defining feature of our markets.’
‘However, the long-term fundamentals supporting recycled steel have never been stronger. Decarbonisation, circular economy policies, investment in electric arc furnace capacity and growing recognition of recycled steel’s environmental importance continue to create significant opportunities for recyclers worldwide.’
2025 data
The Mirror also carries BIR’s breakdown on global crude steel production in 2025 and the use of recycled steel, prepared by its statistics adviser Rolf Willeke. Total production last year was 1 850.1 million tonnes, a decline of 1.9% compared to 2024, according to worldsteel.
China retained its position as the world’s largest crude steel producer despite a 4.4% decline to 960.8 million tonnes.
Willeke notes that recycled steel usage was 4.5% higher in 2025 at 480.268 million tonnes. Recycled steel usage was higher in China, the USA, India and Türkiye whereas decreases were registered in the EU, Japan and South Korea.
The figure for recycled steel consumption represents around 75% of global steel usage in 2025. China’s usage of recycled steel increased by 8.3% year on year, reaching 227.0 million tonnes.
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