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Steelmaking Revolution: India’s Scrap Consumption Rises 8% in 2024

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India’s ferrous scrap consumption rose by 8% year-on-year in the first 10 months of 2024 (10MCY’24), reaching 28.08 million tonnes (mnt) compared to 26 mnt in the same period last year. This marks a pivotal shift toward sustainable steelmaking practices.

Domestic Scrap Takes the Lead
Domestic scrap consumption soared by 22% to 21.06 mnt, while imported scrap usage fell 19% to 7.02 mnt, highlighting a growing preference for locally sourced materials. Key drivers include increased availability and favorable pricing.

Initiatives like the Indian Railways’ scrap sales program, targeting INR 5,400 crore revenue in FY25, and the End-of-Life Vehicle (ELV) policy are significantly boosting domestic scrap generation. ELV is expected to add 6 mnt of scrap annually by 2025, fostering a circular economy.

Shift to IF-EAF Steelmaking
The share of Induction Furnace (IF) and Electric Arc Furnace (EAF) steelmakers rose, consuming 22.69 mnt of scrap—an 11% year-on-year increase. In contrast, the Blast Furnace (BF) route’s share fell by 3% to 5.36 mnt. These electric methods align with India’s carbon reduction targets, offering cost-efficient and eco-friendly steel production solutions.

Price Advantage Drives Domestic Preference
Domestic scrap prices, such as HMS 80:20 DAP Jalna, remained INR 1,651/t cheaper than imported alternatives, at INR 33,180/t versus INR 34,775/t in October 2024. This price gap makes local procurement more viable as global scrap availability tightens.

Steel Demand Boosts Scrap Consumption
India’s crude steel production rose 6% year-on-year to 122.68 mnt in 10MCY’24, further fueling scrap demand.

Outlook: Reduced Import Reliance
Domestic scrap availability is set to grow, with imports projected to drop over 30% in FY25. Investments in recycling infrastructure and the rise of alternative feedstocks like sponge iron will solidify this trend, supporting a self-reliant and sustainable steel industry.

India’s scrap market is evolving rapidly, driving sustainability, cost efficiency, and growth in the steel circular economy.

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