Scrap is a unique material in so far as it is not a manufactured product, but is an arising which sells for a price in the market, is traded globally and is an extremely crucialraw materialforsteelmaking, especially for the Electric Arc Furnaces (E AF). The global demand for scrap is a derived demandin the sense that it is governed by the demand for finished steel products. The world demand-supply forscrap has recently beenimpactedby another factor, which is the growing production of substitutes for steel scrap which include DRI (Direct ReducedIron) andHBI (Hot Briquetted Iron). DRI can substitute scrap in the steelmaking process to a large extent, so that the relative price of scrap vis-a-vis DRI becomes an important factor for determining the scrap demand.
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