Several prominent German industry associations representing steel producers, metal recyclers, and downstream manufacturing have jointly urged the European Commission to rethink proposed restrictions on exports of steel scrap and other ferrous secondary raw materials. The associations argue that while the intent of the planned measures is to secure critical raw materials for Europe’s green transition, overly rigid rules on the export of scrap could trigger unintended consequences for EU steelmakers, recyclers, and industrial customers. By constraining traditional trading routes for high-quality ferrous scrap, the groups warn that the draft legislation risks depressing collection incentives, distorting prices, and ultimately limiting the availability of secondary raw materials exactly when European steelmakers are accelerating investments in electric arc furnace (EAF) and other low-carbon production technologies.

According to statements released today, the German associations stress that ferrous scrap is already a cornerstone of Europe’s circular steel value chain, with recycling rates at global benchmark levels and a well-developed network of collectors, processors, traders, and steel plants. They note that many European steel producers are basing their decarbonisation strategies on increased scrap usage, which allows for substantial reductions in direct CO2 emissions compared with traditional blast furnace-basic oxygen furnace routes. The associations therefore argue that stable and predictable access to competitively priced scrap, sourced both within the EU and through international trade, is critical for maintaining the cost base and operational reliability of EAF-based growth plans. If export channels are abruptly limited, they say, the market may suffer lower liquidity, weaker price signals, and reduced investment in collection and sorting technology.

The industry groups also highlight that Europe currently generates more ferrous scrap than its integrated steel sector can absorb, and that international trade plays an important balancing role. By exporting certain qualities and grades that may not be immediately needed domestically, recyclers can sustain high collection rates and support the broader transition from primary ores to secondary raw materials. The associations caution that a unilateral tightening of export conditions, without careful impact assessment and coordination with global partners, could prompt retaliatory measures or shift trade flows to regions with lower environmental and social standards. In turn, this could undermine the EU’s aim of promoting high sustainability benchmarks along global steel value chains, while simultaneously exposing European mills to supply bottlenecks in specific scrap segments, such as high-purity low-residual grades needed for automotive and appliance sheet.

From a competitiveness perspective, the German organizations argue that additional administrative burdens and licensing requirements attached to scrap exports may raise logistics costs and create uncertainty for long-term contracts. They point out that EU steelmakers already face higher energy prices, increasingly stringent climate policies, and significant capital expenditure for low-carbon technologies. In their view, policy makers should avoid adding further structural disadvantages that might push investment and production capacity outside Europe. Instead, they propose that the European Commission focus on measures that improve the functioning of the internal recycling market, foster cross-border infrastructure for collection and processing, and incentivise quality upgrades in scrap streams so that more material can directly meet the demanding specifications of advanced steel applications.

The associations underline that preserving open and rules-based trade in ferrous scrap is not incompatible with Europe’s climate and resource-security goals. They suggest that carefully designed safeguards against clearly identified environmental or human-rights risks in destination countries would be more proportionate than broad quantitative or licensing restrictions. At the same time, they call for closer consultation with steelmakers, recyclers, equipment suppliers and technology providers before finalising any new legally binding framework. This includes detailed modelling of supply-demand scenarios for both basic and high-grade steel scrap, taking into account the planned ramp-up of EAF capacity, the age profile and composition of Europe’s end-of-life vehicle and construction stock, as well as the potential impact of other policy instruments such as the Carbon Border Adjustment Mechanism.

For stakeholders across the European steel value chain—including mills, plant builders, automation suppliers, engineering firms, and recycling technology providers—the outcome of this policy debate holds substantial strategic significance. If the European Commission ultimately adopts stringent export restrictions, market participants may need to rethink sourcing strategies, renegotiate long-term supply contracts, and accelerate investments in advanced scrap sorting, shredding, and contaminant removal technologies to extract more value from domestic arisings. Conversely, a more flexible regime that maintains open trade while tightening sustainability criteria could support both the economic viability of the recycling sector and the long-term decarbonisation trajectory of steelmaking. In either case, today’s coordinated intervention by German industry associations signals growing concern that regulatory decisions on scrap flows will be a defining factor for Europe’s ability to deliver competitive, low-carbon steel production at scale over the next decade.