Why the price of steel is continuing to increase: circular economy

maggio 06, 2021

Circular economy is a topic that has been discussed a lot about in the last months, considered as one of the possible solutions to many of the environmental problems that afflict the Earth. Each type of human activity has an impact on the environment and biodiversity, however if we take into consideration the metalworking industry we have more advantages than disadvantages from a circular economy perspective. Steel, the raw material of many of the objects that are made by industry, is 100% reusable for infinite times. What constitutes a polluting element is in fact restricted to machinings and transport; moreover, unlike production starting from other raw materials, steel requires the use of less energy and consequently emissions are lowered.

What is the circular economy?

It is often defined as the type of economy based on the recycling and reuse of the same material without it needing to be disposed of as waste. Raw material, production, processing, use, reuse and processing, recycling and redesign are the founding principles of life of a mechanical product. The steel components are taken up, separated and then reused because they do not show any loss in terms of mechanical properties.

The circular economy of steel: for cleaner cities

Due to its composition, steel lends itself well to be used in different ways, because often the world of mechanics cannot reuse the same alloy. Therefore, other uses are destined for it in different sectors. Thanks to its resistant structure, this material is perfect for use in construction as protection from natural disasters. The societies continue to grow and with them also infrastructures and buildings, so the problem of air pollution and its breathability is becoming an issue to be taken into consideration. Over the past decade, industry has greatly reduced its emissions and energy waste, using innovative technologies.

However, around iron there are also several dark sides, which risk leading to strong economic and competitiveness inequalities. In addition to this we must consider the ever increasing demand for steel which creates many problems.

Why does steel increase in price and demand increases?

The rise in the price of steel is certainly a consequence of the pandemic which, having destabilized the balance, made such an accelerated recovery difficult. Mainly driven by the automotive sector which, although it is converting to electric, therefore will require fewer steel components, requires massive production. Currently, it is estimated that another reason for such a sudden rise in requests is given by China, which accounted for almost half of the consumption of raw materials from November 2020 to January 2021, when the pandemic was a distant memory for them. The USA, despite their not very favorable health situation, have nevertheless shown good flexibility and ability to stimulate the market. So it is not yet known exactly what will happen but the trend is soaring, the work is growing and the foundries are saturated. This involves very long waiting times and consequent delays, given by the most disparate variables.

The solution to all this does not exist, it is necessary to manage the difficulties day by day and look for the best solution to reconcile supply with demand.

Why the price of steel is continuing to increase: circular economy

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