EU Steel Output Growth Requires Millions of Tons in Extra Scrap: Think Tank Forecast

Meta Description: The EU needs 8–11 million extra metric tons of steel scrap by 2028 to boost crude steel production 12–13% via new electric arc furnaces, offsetting import declines from CBAM and steel safeguards, per GMK Center analysis.

The EU must raise crude steel output by 12%–13% by 2027 to counter falling imports driven by steel safeguards and the Carbon Border Adjustment Mechanism (CBAM). Meeting this target and rolling out new electric arc furnace (EAF) capacity will require an additional 8 million–11 million metric tons of steel scrap later this decade, Stanislav Zinchenko, CEO of Kyiv-based think tank GMK Center, told Platts, part of S&P Global Energy.

EAF Expansion Drives Surging Scrap Demand

Prior to the policy shifts, the EU imported 7 million metric tons of long rolled steel per year, roughly half produced via the blast furnace-basic oxygen furnace route. Those volumes are now set to be replaced by EU-based, scrap-intensive EAF production.

To offset the expected import decline, the 12%–13% production growth target by 2027 (from 2025 levels) will require an extra 4 million–6 million metric tons of steel scrap. By 2028, the commissioning of new EAFs could lift domestic scrap demand by a further 4 million–5 million metric tons.

A pipeline of already-announced EAF projects represents major new capacity additions:

• Metinvest: 2.7 million mt greenfield plant in Piombino, Italy

• Voestalpine: 2.5 million mt across projects in Linz and Donawitz, Austria

• Marcegaglia: 2.1 million mt unit in Fos-sur-Mer, France

• ArcelorMittal: 2 million mt EAF in Dunkirk, France

• NLMK: expansions in Verona (+0.5 million mt) and Belgium

Zinchenko noted these facilities will run predominantly on scrap feedstock in their initial years, until sufficient low-cost direct reduced iron (DRI) and hot briquetted iron (HBI) become available on the EU market. Once fully operational, the projects will generate up to 5 million mt of additional annual scrap demand.

“We are seeing a clear, pragmatic trend in which steelmakers are prioritizing scrap-based EAF capacity additions over capital-intensive DRI-hydrogen concepts,” he said.

The forecast assumes a mixed feedstock of scrap, DRI and HBI, and non-maximum capacity utilization, as future run rates for the new EAFs remain uncertain. Feedstock mix will fluctuate quarter to quarter based on market prices for metallic inputs.

Policy Shifts to Tighten Scrap Export Supply

Rising demand is expected to support domestic European scrap prices and potentially boost collection rates. Today, however, meeting inflated requirements with local supply remains challenging: the EU recorded net scrap exports of 11.5 million mt to third countries in 2025 alone.

That dynamic is set to shift by 2027. The European Commission is targeting a 4 million–4.1 million mt, or 25%–26%, reduction in annual steel scrap exports from 2025 levels. It has proposed cutting off most non-OECD countries from EU scrap metal supplies as of May 21, 2027, and on September 18 presented a draft delegated act under the revised Waste Shipment Regulation to implement the restriction.