Although the worst of the pandemic-related supply chain and materials cost issues are behind us, some challenges remain for the construction industry. One of those is the U.S. steel market, which is experiencing elevated prices of around $1,100 per ton.

Despite enjoying prices nearly double those of nearby regions, U.S. steel mills have maintained restrained production levels by operating at just over 73% of capacity. The combination of low production rates and decreased import volume has resulted in higher prices.

While some market indicators predict these high prices are temporary, and future data foresees a gradual decline, scrap has become the primary raw material for the Swiss Steel Group, one of the largest producers of steel on the electric arc furnace route.

Steel is one of the most commonly recycled materials in the world. Processing more than 2.2 million tons of scrap annually, Swiss Steel Group is the largest steel company in Europe that uses the electric arc furnace route exclusively for production.

By producing steel from presorted scrap instead of iron ore and alloy metals, less energy is used, and less carbon dioxide is generated. However, the quality of the scrap influences the quality of the steel produced and the environmental impact. High-quality steel production requires scrap material from metal processing in which the alloy additions are known. Swiss Steel has implemented a five-stage process maturity model to improve scrap quality.

By partnering with scrap dealers, Swiss Steel can produce “green steel”—steel that is manufactured without the use of fossil fuels. Additionally, because transporting scrap long distances is inefficient and has a significant carbon footprint, working with local sources minimizes the environmental impact while supporting the local economy. For example, in Germany, France and Switzerland, Swiss Steel Group sources most of its scrap from within a 90- to 100-kilometer radius.

Partnering with scrap dealers is also resulting in quality material. Scrap dealers have become important system partners in the steel industry.

In Switzerland, Swiss Steel is working with scrap suppliers and several universities on a government-funded project to create a digital twin of incoming scrap. A digital twin is a virtual model designed to accurately replicate a physical object, and is often used in construction. The project uses big data that allows steelworks to predict what kind of scrap will be delivered. This increases efficiency, effective delivery, production and steel quality.

This groundbreaking digital twin for scrap has potential applications beyond the steel industry, as it’s believed the system can also be used for other materials.