Thyssenkrupp Materials Services, the trading unit of German steelmaker Thyssenkrupp, is tapping into the recycling and selling of steel scrap under a newly formed joint venture, Thyssenkrupp said June 23.
The joint venture “mt industry recycling” was founded June 2 together with Germany-based venture builder Mantro and will recycle and sell scrap sourced from product waste and metal processing companies.
The company aims to eliminate the scrap dealer in the supply chain and sell directly to steel mills and foundries.
“Already today, almost half of the steel production comes from recycled steel scrap. In Germany alone, this corresponds to over 20 million metric tons of scrap every year,” said Jan Crommelinck, managing director of mt industry recycling and Lead New Business Model at Thyssenkrupp Materials Services.
According to a joint press release, the jv would be able to offer lower costs and purchase prices due to a streamlined process while providing scrap that can be melted down and reprocessed “without any loss of quality.”
A Thyssenkrupp Materials spokesperson could not confirm how much volume the jv aims to turn over per year and said that the first stage of the company would be to “validate the business model.”
According to German scrap association BVSE, steel scrap usage for crude steel production stood at 17.7 million mt in Germany in 2019, down 4.8% year on year. The outlook for 2020 remains bearish in terms of demand as Germany’s economy and its key sectors such as the automotive and mechanical engineering industries were put on a temporary halt in spring due to the COVID-19 pandemic.
— Laura Varriale