Metal Recycling: will digitalisation solve key industry challenges?
The global metal recycling industry is growing at an unprecedented rate due to factors such as urbanisation, the spread of industrialisation, concerns over environmental sustainability, and laws and regulations pertaining to metal scrap.
The global metal recycling industry is growing at an unprecedented rate due to factors such as urbanisation, the spread of industrialisation, concerns over environmental sustainability, and laws and regulations pertaining to metal scrap. Currently, the raw material that produces 40% of steel worldwide is recycled steel.
Obviously, the opportunities are boundless, but as the industry grows so, too, do the challenges for C-Suites, indicating that new solutions and ways of thinking will be needed to succeed. Let’s first take a look at the industry as it currently stands and then address solutions to challenges.
The state of the industry
The global scrap metal recycling industry is worth U.S. $280 billion (€250 billion). Expect growth in revenue of 3% by 2024, reaching U.S. $340 billion. Forecasts vary, with Reportlinker projecting the industry to hit U.S. $434.55 billion by 2023. To quibble over differences in value at this point is to miss the bigger picture: the industry will continue to grow at a rapid rate.
One reason can be attributed to emerging economies, such as China, India, Brazil, and South Africa. With economic development comes the need for metal, which presents opportunities for industry players. Meanwhile, Europe is a mature market, but North America, South Korea, and Turkey are catching up.
Trends and drivers
Another major trend that’s feeding global growth: key industries are turning to recycled metal. Those key industries, such as automotive and construction – a booming sector thanks to urbanisation – are opting for recycled metal. Behind these industries’ decisions are multiple drivers. Recycling metal repeatedly does not degrade the materials’ properties, while it also helps curtail landfall usage, reduce costs and efficiently manage resources.
Sustainability is a major issue. It’s not only about moving in the direction of a circular economy by directing solid waste away from landfill and turning it into useful products. By using recycled metals, these industries don’t have to rely on mining operations that destroy habitats.
And here we get to the matter of laws and regulations, a critical business driver for the industry.
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