# Steel and its scrap

Markdown version of https://bluegreenmaterials.com/en/steel. Updated on 2026-11-08.

Steel is the most recycled material in the world and in Mexico almost all of it is made by melting scrap. Here is what is worth knowing to sell it well: what it is, how it is graded and what lowers its price.

## What steel is

Steel is an alloy of iron with less than 2% carbon, plus small amounts of manganese, silicon, phosphorus, sulphur and oxygen. There are more than 3,500 different grades[^ws-facts]. What changes between them is the carbon and the elements added on purpose.

**The families you see most in a yard**

| Family | What sets it apart | How it behaves |
| --- | --- | --- |
| Carbon steel | Iron and carbon with no added alloys. As a usual reference, low carbon is below 0.30%, medium between 0.30% and 0.60%, and high above that | More carbon means harder and stronger, and less ductile and weldable |
| Alloy steel | Contains added nickel, chromium, molybdenum or manganese. ReMA calls scrap "unalloyed" with residuals up to 0.45% Ni, 0.20% Cr, 0.10% Mo and 1.65% Mn[^rema-specs] | More strength, toughness or wear resistance depending on the alloy |
| Stainless steel | At least 10.5% chromium[^ws-facts]. The 300 series (304, 316) contains nickel; the 400 series (430) does not | Chromium forms a passive layer that protects it from corrosion. The 300 series barely responds to a magnet |
| Cast iron | More carbon than steel (above 2%) | Brittle; it is cast in moulds instead of rolled. It is bought separately as cast scrap |

Two properties explain why steel scrap is so easy to recover: it is **magnetic**, so an electromagnet separates it from plastics and non ferrous metals[^ws-raw], and it is **dense**, so it is loaded and moved in large volumes.

## A permanent material

worldsteel describes steel as a permanent material: it is recycled again and again without losing its properties[^ws-facts]. The bar that leaves a furnace today can hold atoms from a rail, a car and a beam from decades ago.

- **90%**: of the steel in end of life cars is recovered[^ws-facts]
- **90%**: of the steel in machinery is recovered[^ws-facts]
- **85%**: of the steel in construction is recovered[^ws-facts]
- **30%**: recycled steel is the average content of a new steel product[^ws-facts]

In 2022 the world steel industry recycled between 650 and 700 million tonnes of scrap[^ws-facts]. Steel products last 40 years on average, from weeks in packaging to more than two centuries in a building[^ws-raw], so the scrap available grows with the steel used in the past.

## How steel is made

There are two main routes. The **blast furnace with basic oxygen furnace** (BF-BOF) starts from iron ore and coal. The **electric arc furnace** (EAF) melts mostly scrap with electricity and can run on 100% scrap, while an oxygen converter takes up to about 30%[^ws-facts].

**Raw materials per tonne of crude steel, world average[^ws-facts]**

| Route | Iron ore | Coal | Limestone | Scrap |
| --- | --- | --- | --- | --- |
| Blast furnace and converter | 1,370 kg | 780 kg | 270 kg | 125 kg |
| Electric arc furnace | 586 kg | 150 kg | 88 kg | 710 kg |

The electric furnace is also fed with direct reduced iron (DRI), which dilutes residuals when the scrap available is not clean enough[^daehn-cu].

## Mexico melts scrap

Worldwide, 30.3% of crude steel was made in electric furnaces in 2025. In Mexico it was **95.9%** of 13.5 million tonnes, which makes the country one of the producers most dependent on scrap[^ws-figures]. CANACERO reports that 96.7% of national output comes from electric arc furnaces[^canacero-cifras].

- **13.5 Mt**: of crude steel produced in Mexico in 2025, 15th in the world[^ws-figures]
- **95.9%**: of that steel was made in electric furnaces[^ws-figures]
- **1.6 Mt**: of ferrous scrap exported by Mexico in 2025[^ws-figures]
- **1.4 Mt**: of ferrous scrap imported by Mexico in 2025[^ws-figures]

Every tonne of scrap that stays in the country and reaches a Mexican mill well graded is raw material that does not have to be imported. See [the environmental impact of recycling it](https://bluegreenmaterials.com/en/impact).

## Where scrap comes from

- **Home scrap**: Recovered inside the mill itself, for example in rolling. It never reaches the market[^ws-raw].
- **New or prompt scrap**: Generated when steel products are made: stamping offcuts, turnings, rejected parts. The most valuable because it is concentrated and clean[^ws-raw].
- **End of life scrap**: From dismantled goods: cars, buildings, ships, machinery. The most abundant and the most varied, with more traces of other elements[^ws-raw].

## Ferrous scrap grades

The market uses the ReMA (formerly ISRI) specifications circular as its common language. Each grade sets thickness, maximum size, density and cleanliness[^rema-specs]. These are the most common.

**Most used ferrous grades, according to the ReMA circular[^rema-specs]**

| Grade | ReMA code | What it is |
| --- | --- | --- |
| HMS 1 (heavy melting steel 1) | 200, 201, 202 | Steel 1/4 inch (6.35 mm) thick or more, in pieces up to 5 by 2 feet |
| HMS 2 (heavy melting steel 2) | 203 to 206 | Steel 1/8 inch or more, black or galvanised |
| HMS 1&2 80:20 | No code of its own | A commercial blend of grades 200 to 206; a market convention, not a ReMA grade |
| No. 1 Busheling | 207 | Clean new factory clippings, uncoated, up to 2 by 5 feet |
| No. 1 and No. 2 bundles | 208, 209 | Sheet compressed to at least 75 pounds per cubic foot |
| Shredded | 210, 211 | Mixed and auto scrap shredded and magnetically separated |
| Plate and structural | 231, 232, 236 to 238 | Clean plate and sections 1/4 inch or more, cut to size |
| Machine shop turnings | 219, 220, 221 | Steel turnings and chips, without excessive oil |
| Iron borings | 223 | Clean cast iron borings and drillings |
| Cupola and machinery cast | 252, 261 | Clean cast iron pieces, furnace sized |
| Stainless 18-8 (type 304) | Sabot (solids), Ultra (turnings) | At least 7% nickel and 16% chromium |

> Stainless 316 and 430 have no grade of their own in the circular: they are traded by description or chemical analysis[^rema-specs]. To see what your material is worth, see [how we build the offer](https://bluegreenmaterials.com/#precio).

## What lowers the value of a load

- **Copper and tin.** They cannot be removed in the furnace. Above 0.1% copper, steel cracks when hot rolled, and tin makes it worse[^daehn-cu]. That is why motors, cable and bronze parts are separated first.
- **Dirt, plastic, rubber and wood.** Every grade must be free of dirt, non ferrous metals and foreign material[^rema-specs]; anything that is not steel is paid as loss.
- **Oil.** Turnings must come without excessive oil[^rema-specs]: draining them before loading improves the price.
- **Out of grade size and thickness.** A piece larger than the furnace charging box needs cutting, and thin sheet mixed with heavy scrap lowers density.
- **Excessive rust.** Rust is iron that no longer yields as metal[^rema-specs].
- **Closed containers.** They can explode in the furnace. They are cut and cleaned first, or not accepted.

## Frequently asked questions

### Is recycled steel as good as new steel?

Yes. Steel recycles without losing its properties[^ws-facts]. What matters is the chemistry: the mill blends scrap to reach the composition each product needs.

### How do I know if my material is stainless?

A quick test is a magnet: 300 series stainless barely sticks, although cold working can make it slightly magnetic. To know the exact series, a spectrometry analyser is used.

### What is HMS?

Heavy Melting Steel. HMS 1 is steel 1/4 inch thick or more and HMS 2 is 1/8 inch or more[^rema-specs].

### Why is scrap with copper paid less?

Because copper does not come out in the furnace and above 0.1% it cracks steel during rolling[^daehn-cu]. The mill has to dilute it with clean scrap or direct reduced iron.

## Sources

[^ws-facts]: World Steel Association (worldsteel), «#SteelFacts, June 2026 update» (2026). https://worldsteel.org/wp-content/uploads/SteelFacts_update-June-2026.pdf
[^rema-specs]: Recycled Materials Association (ReMA), «ReMA's ISRI Specifications Circular, Ferrous Scrap Guidelines (FS-2023)» (2026). https://www.isrispecs.org/wp-content/uploads/2026/09/2026-July-ReMA_ISRI_Specifications.pdf
[^ws-raw]: World Steel Association (worldsteel), «Raw materials: scrap» (2026). https://worldsteel.org/about-steel/raw-materials/
[^daehn-cu]: Environmental Science & Technology (ACS), «Daehn, Cabrera Serrenho and Allwood, How Will Copper Contamination Constrain Future Global Steel Recycling?, 51(11):6599 a 6606» (2017). https://pubmed.ncbi.nlm.nih.gov/28445647/
[^ws-figures]: World Steel Association (worldsteel), «World Steel in Figures 2026» (2026). https://worldsteel.org/wp-content/uploads/World-Steel-in-Figures-2026.pdf
[^canacero-cifras]: Cámara Nacional de la Industria del Hierro y del Acero (CANACERO), «Acero en cifras» (2026). https://canacero.org.mx/