Ferrous scrap is the iron and steel left over from industrial processes or that has reached the end of its useful life, and it is the main raw material for electric arc furnace steelworks. It isn’t something to be got rid of, but a material with an international market, recognised grades and a value that depends on its density and purity. Within an integrated scrap metal system (collection, sorting, processing and sale to the steel mill) it goes back into industry as new steel, again and again.
Below you’ll find the main types, what determines their value, where they go and how to organise the whole process so that your company gets the most out of its scrap.
Why is ferrous scrap a raw material and not waste?
Because a whole industry depends on it. Electric arc furnace steelworks make new steel mainly by melting scrap, and integrated steelworks, which start from iron ore, also use it as part of their charge. The iron in scrap has already been mined and reduced, so melting it saves ore, coal and emissions compared with making steel from scratch. We set out the figures in why recycling ferrous material matters.
EU legislation itself recognises this. Council Regulation (EU) No 333/2011 sets the criteria under which iron and steel scrap ceases to be waste and is treated as a product: it must be ready for direct use in steelmaking, free of oils and pressurised containers, with foreign materials kept under control, and it must have passed a radioactivity check. In other words, properly prepared scrap is a raw material in every sense.
What types of ferrous scrap are there?
The first big division is by origin. New production scrap comes from industrial processes (stamping offcuts, cutting remnants, rejected parts): it is uniform, clean and of known composition. Post-consumer scrap, also called obsolete or old scrap, comes from things that have reached the end of their life (demolished structures, machinery, vehicles, household appliances): it is more varied and needs more processing.
It is then graded by thickness, density and processing. The Spanish market uses grade names such as OA, ‘industrial’, No. 1 and No. 2, from thickest to thinnest, although each steel mill sets the exact cut-offs in its own specification. Broadly speaking:
| Grade | What it is | Examples | How it’s prepared |
|---|---|---|---|
| Heavy (OA, ‘industrial’) | Thick-section steel | Beams, machine beds, machinery, structures | Oxy-fuel cutting and shearing to furnace size |
| Medium and light (No. 1, No. 2) | Thinner sheet and sections | Shelving, cladding, car body panels | Shearing, baling or shredding |
| Bundles | Compacted light offcuts | Stamping offcuts and pressings | Baler, 300×300 to 400×400 mm |
| Shredded 210/211 | Small, dense, clean pieces | Vehicles, household appliances, mixed scrap | Shredder and magnetic separation |
| Low-residual | Scrap with very little copper, tin, chromium or nickel | Clean industrial production offcuts | Selected and stored separately |
| Turnings | Machining residue | Turning, milling, drilling | Collected separately, without excess oil |
Each grade has its own specification sheet in our ferrous metals section: shredded, sheared and low-residual.
How is light ferrous scrap processed?
Light scrap (thin sheet, offcuts, light sections, casings) has one problem: it takes up a lot of space and weighs very little. Loose, it is expensive to transport because the lorries are mostly carrying air, and it melts less efficiently in the furnace, with higher oxidation losses. Processing light ferrous scrap means giving it density, and there are two ways of doing that:
- Baling, for clean production offcuts. Balers compact the sheet into bundles of 300×300 to 400×400 mm that are dense, easy to load and as clean in composition as the original offcut.
- Shredding, for post-consumer light scrap that comes with contaminants: household appliances, car bodies, painted or mixed sheet. The 4,000 hp shredder breaks it up, magnetic drums separate the steel, and the result is 210/211 shredded scrap, dense and uniform.
If your company generates a lot of light offcuts, the key is not to mix them with heavy scrap or non-metallic waste, and to look at whether it pays to bale them on your own premises with a mobile baler to cut down on trips.
What determines the value of ferrous scrap?
Unlike copper or aluminium, which are priced against the LME, ferrous scrap is traded mainly on the basis of steel mill demand and international steel scrap benchmarks. Turkish steel mills’ purchases are one of the most closely watched benchmarks, because Turkey is one of the world’s largest scrap importers. From there, the value of a specific lot depends on:
- Density: the denser it is, the better it performs in the furnace and the less it costs to move.
- Residual elements: copper, tin, chromium and nickel aren’t removed during melting and limit the type of steel that can be made. Low-residual scrap, with very little copper (each steel mill sets the limit in its specification), commands a better price.
- Cleanliness: soil, plastics, wood or other non-metallic material reduce the usable weight and are deducted.
- Quantity and logistics: the volume, how regular the supply is and the distance to the plant.
- The dollar–euro exchange rate, because the international market trades in dollars.
That’s why there is no single price for ‘scrap’: each lot is valued for what it is. We look at how market swings affect industry in the impact of metal prices.
Where does ferrous scrap go when it leaves the plant?
To three main destinations. Electric arc furnace steelworks turn it into new steel for rebar, sections and sheet. Grey iron and ductile iron foundries mainly use low-residual scrap and charge-ready cut foundry grades to make castings. And part of it goes to the export market as compacted bundles.
This is the circular economy in the literal sense: the steel from a dismantled industrial building comes back as reinforcing bar for a new building, without losing its properties along the way, and without opening a mine to get it.
What is an integrated scrap metal system?
It means a single operator managing the whole scrap cycle: containers at the customer’s premises, collection, environmental paperwork, sorting, processing at the plant, quality and radiation checks, and sale to the steel mill. For the company that generates the scrap, that means a single point of contact, end-to-end traceability and every grade being paid for what it is.
At Alberich we do this with our own machinery and technology:
- At source: containers from 1 to 30 m³, our own fleet, a mobile baler for on-site baling and, for very large structures, cutting on site.
- At the plant: three sites (Castellbisbal, La Llagosta and Constantí), a 4,000 hp shredder, 600–1,000 t shears, balers and a low-residual line.
- Checks: a trade-approved weighbridge, radiation monitoring on the way in and on the way out, hand-picking and separation of the non-ferrous metals that come mixed in with the scrap.
- Paperwork: waste acceptance form, waste tracking sheet and certificates, under waste management authorisation no. E-345.97 issued by the Catalan Waste Agency.
The plant process, step by step, is set out in how to recycle ferrous materials.
Ways to recover value from scrap metal, depending on your situation
A plant with continuous production usually needs separate containers for each grade and regular collections, with clean offcuts kept apart so they are valued as low-residual. A construction project, refurbishment or decommissioning job generates large volumes all at once: the usual approach there is to combine high-capacity containers with on-site cutting, or to build scrap management into the industrial demolition itself. And if you’re a private individual or a small workshop, you can take your scrap to any of the 8 sites in the Scrap Center network.
Frequently asked questions
What is the difference between 210 and 211 scrap?
Density. Both are shredded scrap, the material that comes out of the shredder once the steel has been separated with magnets. Above one tonne per cubic metre it is classed as 211, and below that, as 210. The grade numbers come from the international scrap classification.
Is ferrous scrap hazardous waste?
No, clean iron and steel scrap is non-hazardous waste. It can become hazardous if it is contaminated with hazardous substances such as oils, chemical residues or asbestos. In that case it carries a different EWC code (European List of Waste) and needs different handling, which we coordinate with the authorised final treatment facility.
Is stainless steel classed as ferrous scrap?
It is steel, but it isn’t mixed with ordinary ferrous scrap. It is bought and sold by alloy (304, 316, 400 series) because its chromium, nickel and molybdenum are highly valuable, and because in a carbon steel mill those same elements would be unwanted residuals. That’s why it has a family of its own: stainless steel.
If you’d like to know what your ferrous scrap is worth or how to organise its collection, tell us what type of material you generate and how much. We’ll get back to you with a valuation within 48 working hours.
