A Reuters analysis published today highlights a structural constraint in Europe’s decarbonisation pathway for steel: limited scrap availability. While electric arc furnace (EAF) routes using recycled scrap can cut direct emissions by up to roughly 58% vs blast furnaces, scrap currently supplies about 32% of global steel demand and is projected to reach only about 46% by 2050. Europe’s strong policy push toward EAF and recycled-steel production risks a scenario where demand for scrap outstrips supply, potentially driving up scrap prices and causing emissions leakage if primary (virgin) steel production simply shifts to regions with lower environmental standards. The article argues that relying solely on scrap would hamper the EU’s broader industrial decarbonisation goals and suggests that large-scale investment in low-carbon virgin-steel technologies (hydrogen-based DRI, CCUS for BF-BOF) is also required. Policy recommendations included standardized scrap-content disclosure, transparent reporting of direct and indirect emissions, and an industrial decarbonisation accelerator to finance low-emission virgin steel projects alongside recycling expansion—measures intended to maintain capacity, protect jobs, and avoid offshoring emissions.
