Steel Companies Accelerate Scrap Usage as Green Steel Norms Take Effect

India’s leading steel producers are stepping up investments in scrap based steelmaking and downstream processing infrastructure as the government begins implementing its green steel taxonomy. The move marks a structural shift in how steel will be produced, rated and procured in the coming years.

With the rollout of green steel star ratings linked to carbon emissions, companies such as Tata Steel, ArcelorMittal Nippon Steel India and JSW Steel are recalibrating their production strategies. The rating framework, which classifies steel based on emission intensity, is expected to influence procurement decisions, particularly for public sector projects.

To align with the evolving regulatory landscape, steelmakers are expanding scrap processing capacities across regions. Scrap based production significantly reduces carbon emissions compared to traditional blast furnace routes that rely heavily on iron ore and coal. Companies are setting up dedicated recycling facilities and modern scrap processing centres to improve quality and consistency of feedstock.

Industry executives indicate that regional production strategies are also being redesigned. While integrated plants in eastern India will continue to operate on conventional raw materials, future capacity additions in northern, western and southern markets are likely to rely more on recycled inputs. This approach not only lowers emissions but also enhances supply chain efficiency.

The government’s decision to mandate the use of certified green steel by public sector undertakings is expected to create steady demand. As infrastructure and construction projects increasingly factor sustainability into procurement, green rated steel could command strategic preference.

The transition signals a broader transformation within India’s steel sector. Beyond compliance, companies view green steel as a long term competitive advantage in both domestic and export markets. With investments in recycling, hydrogen usage and renewable energy integration gaining momentum, the industry is positioning itself for a lower carbon growth trajectory.