Report Overview

Increasing government investments in infrastructure development and the growing consumption of stainless steel scrap as a sustainable and cost-effective raw material in various industries are expected to drive the growth of United States Stainless Steel Scrap Market during the forecast period between 2023 and 2029.

United States Stainless Steel Scrap Market – Market Trends & Forecast Report 2029

The United States stainless steel scrap market size was valued at USD 895.3 million in 2022, and is projected to reach USD 1,342.4 million by 2029, growing at a CAGR of 6.05% from 2023 to 2029. The United States stainless steel scrap market is driven by the increasing awareness of water quality and health concerns among consumers. With rising pollution levels and a growing need for clean and safe drinking water, the demand for stainless steel scraps has surged. The market benefits from technological advancements, offering a range of purification options, such as RO, UV, and gravity-based systems, catering to diverse consumer preferences. Additionally, expanding urbanization and the commercial sector's need for purified water contribute to market growth. The presence of various sales channels, including online platforms and retail stores, enhances accessibility for consumers. As a result, the United States stainless steel scrap market is experiencing steady expansion, driven by the fundamental need for reliable and clean drinking water solutions.

Stainless Steel Scrap - Overview

Stainless steel scrap refers to discarded or wasted stainless steel materials that can be recycled to produce new stainless steel products. It encompasses a wide range of items, including sheets, coils, pipes, bars, and various structural components, sourced from manufacturing processes, industrial operations, construction projects, and end-of-life consumer goods. Additionally, non-ferrous materials like nickel or other alloys may be present in certain forms of stainless steel scrap. This scrap plays a vital role in the circular economy by diverting reusable materials from landfills and reducing the environmental impact of stainless steel production. From end-of-life consumer products such as old appliances to materials removed during construction or demolition projects, stainless steel scrap sources are diverse. By extending the life cycle of stainless steel products, recycling scrap contributes to a more sustainable and efficient use of resources in the metalworking industry. It's an environmentally responsible practice that aligns with global efforts to reduce waste and promote sustainable production processes. Overall, stainless steel scrap recycling is an essential and integral component of a greener, more eco-conscious stainless steel production cycle.

United States Stainless Steel Scrap Market

Growth Drivers

Increasing Consumption of Steel

The United States stainless steel scrap market is poised for significant growth further driven by an escalating demand for steel. According to the U.S. Geological Survey, the apparent consumption of steel, a primary end-use for iron and steel scrap, experienced a notable surge, increasing by 18% to reach 98 million tons in 2021, up from 82.9 million tons in the previous year. This surge in consumption was particularly driven by manufacturers of pig iron, raw steel, and steel castings, who accounted for the lion's share of scrap utilization within the domestic steel industry. They employ scrap in conjunction with pig iron and direct-reduced iron to fabricate a diverse range of steel products serving industries spanning from appliances, construction, containers, machinery, oil and gas, to transportation, and various other consumer sectors. This surge in steel consumption underscores the pivotal role that stainless steel scrap plays in meeting the robust demands of these industries, thus providing a strong impetus for the continued growth of the United States stainless steel scrap market in the foreseeable future. Furthermore, the escalating production of raw steel in the country, as indicated by the U.S. Geological Survey's data for 2021, which saw a notable 19% surge to 87 million tons from the previous year's 72.7 million tons, is poised to sustain this upward trajectory. This substantial increase in raw steel production invariably amplifies the demand for stainless steel scrap within the country. This trend is emblematic of a broader global shift towards sustainable practices in the steel industry. By incorporating recycled stainless steel material into their production processes, manufacturers not only diminish their dependence on virgin resources but also mitigate the environmental toll of mining and processing raw materials. Moreover, the utilization of recycled stainless steel scrap often entails lower energy expenditure in contrast to the processing of raw materials, thereby presenting a more energy-efficient alternative. This dual advantage, encompassing cost savings and a diminished carbon footprint, underscores the pivotal role that recycled stainless steel scrap plays in advancing both economic and ecological sustainability in the steel manufacturing sector.

Restraints

Availability of Substitute Products such as Aluminum and Carbon Steel

The availability of substitute products such as Aluminum and carbon steel is expected to hamper the growth of the United States stainless steel scrap market. These substitutes offer viable options for various applications, potentially diverting demand away from stainless steel scrap. Additionally, factors like cost-effectiveness and specific material properties may drive industries to opt for alternatives, impacting the market for stainless steel scrap in the country. This necessitates strategic initiatives within the stainless steel scrap industry to highlight its unique advantages and maintain competitiveness in the face of substitute products.  Furthermore, the carbon steel stands out as a prominent substitute for stainless steel in the United States market, acting as a significant impediment to its growth. As per data from Reliance Foundry Co. Ltd, carbon steels dominate the steel industry, constituting roughly 85% of total production in the United States. This alloy category typically contains a carbon content within the 0–2% range. The prevalence and versatility of carbon steel, coupled with its lower cost, make it a formidable competitor to stainless steel. This underscores the formidable presence of carbon steel and its impact on the stainless steel scrap market in the United States. Additionally. the availability of Aluminum or secondary Aluminum will also obstruct the stainless steel scrap market in the United States. According to the CRS 2022 report, the United States holds a significant position as a producer of secondary Aluminum. Over the years, Aluminum derived from scrap has steadily gained a larger portion of the total U.S. Aluminum output. In 2021, secondary Aluminum accounted for a substantial 78% of the 4.1 million metric tons of Aluminum produced by U.S. smelters. This secondary production was divided between 53% from new scrap, which is material leftover from primary smelting, and 47% from old scrap. This data underscores the formidable presence of secondary Aluminum in the U.S. market, creating a hurdle for the growth of the stainless steel scrap market.

Impact of COVID–19 on the United States Stainless Steel Scrap Market

The United States stainless steel scrap market, like various other sectors, faced significant challenges due to the COVID-19 pandemic. In the early stage of the pandemic outbreak, lockdowns and disruptions in supply chains led to reduced collection and processing of stainless steel scrap. With industrial activities slowing down, demand from key sectors like automotive, manufacturing, and construction declined sharply. Price volatility became a defining feature of the market. Uncertainty about economic recovery and fluctuating demand for steel products led to price swings, affecting both buyers and sellers. Additionally, the pandemic introduced challenges in the export of stainless steel scrap, driven by shifting international trade dynamics, tariffs, and logistical hurdles. According to American Iron and Steel Institute report in 2020, shipments from domestic steel mills measured 81.0 million net tons, down 15.8% from the previous year. U.S. raw steel production was 80.2 million net tons in 2020, a 17.1% decrease from 2019. The report also shows that steel imports into the United States fell for the third year in a row. Total steel imports decreased 21% in 2020 compared to the previous year, while finished steel imports decreased 23% over the same period and captured an 18% share of apparent steel consumption. However, industries began to prioritize recycled materials, like stainless steel scrap, as a cost-effective and environmentally friendly alternative to primary steel production. As vaccination efforts progressed and economic recovery initiatives were implemented, the market gradually rebounded. Demand for stainless steel scrap recovered as industries adapted to new operational norms. The construction sector, in particular, witnessed an increased interest in sustainable building practices, further boosting demand for recycled steel materials. While the COVID-19 pandemic posed significant obstacles for the United States stainless steel scrap market, it also accelerated trends toward sustainability and resilience in the industry, which are likely to have lasting effects in the post-pandemic landscape.

United States Stainless Steel Scrap Market

Segmental Coverage

United States Stainless Steel Scrap Market – By Type

Based on type, the United States stainless steel scrap market is segmented into 200 series, 300 series, 400 series, and others. Among these segments, the 300 series holds a significant market share due to its widespread use in various industries, including automotive, building and construction, and manufacturing. According to the International Organization of Motor Vehicle Manufacturers, the United States produced 10,060,339 units of motor vehicles in December 2022, marking an increase compared to the previous figure of 9,157,205 units recorded in December 2021. The increasing number of motor vehicle production in the United States will help in boost the market growth in the forecast period.

United States Stainless Steel Scrap Market – By Application

Based on application, the United States stainless steel scrap market is segmented into automotive, building & construction, metal products, mechanical engineering, and others. The building & construction segment holds a significant market share due to its extensive use of stainless steel in architectural and structural applications. The demand for stainless steel scrap in this sector is driven by a steady stream of construction projects, including commercial buildings, residential developments, and infrastructure expansion. Based on United States Census Data, in July 2023, construction spending was calculated at USD 1,972.6 billion, showing a 0.7% increase from the revised June estimate. Comparatively, this July figure demonstrates a 5.5% rise compared to the construction spending estimate of USD 1,869.3 billion in July 2022.

Competitive Landscape

The United States stainless steel scrap Market is characterized by many regional and United States vendors. The key players operating in the United States stainless steel scrap Market are MB Metals, Inc., Kristi Corp, OmniSource, LLC, Bob's Metals, Inc., Sriji Enterprises Inc., Greenland (America) Inc., and Schnitzer Steel Industries, Inc. OmniSource is a major player in the stainless steel scrap market, and it has taken a number of steps to strengthen its position in this market. One of OmniSource's key strategies is to focus on building and maintaining relationships with its customers. Greenland (America) Inc. has offices in seven countries, which allows it to source and sell stainless steel scrap all over the world. This gives the company a significant advantage over smaller competitors with a more limited reach.

Recent Developments

• In August 2023 - Sims Metals signed an agreement to acquire Baltimore Scrap, metal recyclers in the north-east of the United States for USD 177 million. The deal is anticipated to close in October, subject to regulatory approval. This will help the company expand its business in the United States ferrous and non-ferrous metals recycling industry. Apart from lead acid batteries, Aluminum, brass, bronze and platinum, Sims Metals also recycles stainless steel.

• In December 2021: SA Recycling, a metal recycling company from Orange, California, acquired PSC Metals, another metal recycling company, from Icahn Enterprises. With this acquisition, SA Recycling has now 125 scrap metal processing facilities from coast to coast including tw23 shredders and 3 port loading operations in Long Beach and Los Angeles, California, and Savannah, Georgia.

Scope of the Report

By Type

• 200 Series

• 300 Series

• 400 Series

• Others

By Application

• Automotive

• Building & Construction

• Metal Products

• Mechanical Engineering

• Others