German steel recyclers pessimistic about 2025

Left to right: BDSV President Andreas Schwenter, Treasurer Stefanie Gottschick-Rieger, Managing Director Guido Lipinski, Managing Director Dr. Claudia Conrads and Vice-President Stephan Karle. (PHOTO: BDSV)

At the recently BDSV Industry Meeting, key concerns were highlighted, including excessive bureaucracy, economic uncertainty, and the need for faster approval processes for CO₂-saving projects.

The BDSV survey revealed that two-thirds of the member companies expect business conditions to worsen in 2025 compared to the current year, with only 2% anticipating improvements.

Investment plans have also declined, with just 15% of companies intending to increase investment in the medium term, a significant drop from last year.

Bureaucracy remains a significant barrier, with 21% of companies reporting that lengthy approval processes have led to the abandonment of projects.

Additionally, the survey noted challenges such as high transport costs, a shortage of truck drivers, low material inflow, and battery fires caused by lithium-ion misthrows. Half of the surveyed companies have experienced fire incidents related to these batteries in the past five years.

Despite the difficult outlook, 60% of companies said they plan to improve processing quality in the coming years. However, only 17% are looking to hire new employees, with 73% expecting to maintain current staff levels and 10% planning job cuts.

Market Trends and Scrap Demand

Germany’s crude steel production saw a 4% increase in the first eight months of 2024, with electric steel production rising by 8.6%.

However, demand for scrap remains balanced at a low level due to reduced investment momentum and economic uncertainty. The steel recycling industry is particularly affected by the slowdown in the construction sector, which has led to a reduction in scrap inflow.

Study on Scrap Logistics

The Fraunhofer Institute for Material Flow and Logistics presented a study on the development of material flows in scrap logistics, focusing on the impact of digital transformation and transport systems.

The study suggests that predictability in transport is becoming more important, and digital solutions could improve transparency and efficiency in the scrap supply chain.

The BDSV, along with DB Cargo AG, has proposed measures to shift more scrap transport from road to rail, emphasising the need for faster wagon processing and improved infrastructure. The association also advocates for modular transport systems and funding support for innovative technologies to reduce CO₂ emissions.

Calls for Regulatory Reforms

The BDSV and the Association of German Metal Traders and Recyclers (VDM) are calling for a “fast lane” in approval processes for projects that reduce CO₂ emissions.

“Increasing regulatory requirements are inhibiting companies’ willingness to invest,” the associations said in a statement, urging the government to revise approval procedures, which can take two years or more. The associations argue that projects contributing to CO₂ reduction should be prioritised to support climate goals and maintain the industry’s competitiveness.