Optimizing Ferrous Scrap

With all the new flat-rolled steelmaking capacity coming on line in the next few years, there is a huge demand for low-residual scrap in many regions of the United States. In addition, manufacturers are stepping up quality requirements for finished steel. As a result, scrap processors are working closely with minimills to make the best use of available scrap supplies, as well as using sophisticated equipment to gain detailed knowledge of scrap chemistries.

Some industry analysts believe that in the future of scrap processing, very large national scrap processors will be able to best service the steel mills since they will be able to draw scrap from a large area, obtaining the best price. These large processors will also have the resources to invest in extensive computer systems to track the types of steel produced by the mills and the associated scrap mix required to make those grades, along with sophisticated sampling and analytical systems.

According to one large national scrap processor, it is already impossible to operate in today’s competitive environment without these types of equipment. Ford, for example, requires its suppliers to be Q-1 certified. This means that it’s necessary to have systems in place to maintain consistency, according to the processor. "We had to ship there for well over a year – thousands of tons a month without a reject – to get that kind of status," he says.

ISO 9000 quality standards are also having a big impact on the industry, says Jim Macaluso, vice president of the ferrous division of Sims Bros. Inc., Marion, Ohio. As mills become ISO 9000-certified, they are requiring the same sort of standards from scrap processors supplying them with raw materials. "Everything is falling in line with the ISO 9000," he says. "In our company, we’re working on ISO 9000 indirectly – we haven’t actually started it, but we’re getting everything in place. It all comes back to record keeping."

In time, Sims Bros. will probably take the plunge and become ISO 9000 certified, he says. In fact, all scrap processors will eventually have to in order to compete, he speculates.

PARTNERSHIPS

Increasingly, steel mills and scrap yards are forming partnerships. Once these relationships are developed, mills are increasingly relying on processors to meet the grade of the steel being made – even to the extent of actually loading the charge box, according to William Heenan, executive director of the Steel Recycling Institute, Pittsburgh.

"What that really does is it allows the scrap processor to pick and choose the variety of different types of scrap in delivering the chemistry that the mill is trying to make," says Heenan. "That practice is spreading. In addition, processors are investing in their facilities and their labs. As you join a partnership like that and get that responsibility, you react to it by putting in the necessary equipment to ensure that you’re living up to the commitment that you’ve made."

Scrap processors that have these types of relationships often have locations on site at mills to sort scrap and load the charge buckets. In other cases, the loading is done ahead of time at the scrap yard. Processors working on site handling the scrap for the mill rely on sophisticated equipment such as spectrometers to get the chemistry right. It’s necessary to continuously monitor the scrap’s chemistry, says one processor.

"Just as you get into a discipline of using check weights on a scale, you have the same discipline with monitoring chemistry – there’s a constant check and using of known sources that you’ve checked to put into mixes," he says.

There is a trend for mills to contract out various services, such as scrap purchasing and handling, agrees Steve Wulff, vice president of planning for the ferrous division of the David J. Joseph Co., Cincinnati. Processors and brokers such as The David J. Joseph Co. often work with mills to deliver a pre-mixed load of scrap with a specific analysis so the mills know what it is and how much of it can be used.

"Some mills do this themselves very effectively," he says. "But at many mills, the focus is on production, and because of various physical constraints they’re unable to do it themselves, so there’s an opportunity for an outside contractor such as ourselves."

Another key to optimizing ferrous scrap, says Macaluso, is good communication with mills. "Every yard builds relationships with mills," he says. "As you find new materials that fit into their specifications, you work with the mills to make sure that they like it. There’s a lot of communication with the mills – not just with the purchasing side, but with the meltmen themselves."

SORTING CONTINUUM

There is a continuum of efforts scrap processors are undertaking to sort and segregate scrap, according to Wulff. All scrap processors do this to some extent, but there is an increasing trend towards more careful sorting and optimizing the value of scrap, he says.

"If you think of a typical steel mill where all the scrap comes in from multiple sources and all of the shredded goes in one pile and all the No. 2 steel goes in another and you have commingling of sources of scrap, that leads to greater range of variability of scrap when it gets to the furnace," says Wulff. "One of the things that we try to do is to work with mill operators to help them maintain or preserve source identity of scrap."

Very often, he says, scrap from a given shredder can have, depending on the operator, a relatively consistent analysis. But another shredder may have a different mix of raw materials, a different machine setup and a different downstream separation system. As a result, the analysis of their product may be significantly different.

"We try to minimize the commingling of scrap from different sources so that we know what the various elements and concentrations are," says Wulff. "It can be logistically difficult to do that – you don’t want to have 167 different piles of scrap with a flag in each one that says where it all came from. One solution is to limit the number of sources; one is to bring them in and use one at a time – to try not to accumulate huge piles of any given thing but turn it over as it comes in. Another technique is just to sample the material when it comes in, and if you have to commingle it, at least you know what you put in the piles. You know what you put together, and in what quantities and concentrations."

Sims Bros. has kept scrap from different suppliers separate for many years, says Macaluso. This is made easier because the company has 28 acres to work with. "We keep ours separate, and we mix it as we need to for the different mills, both by size and by chemistry," he says. "The yard is blocked off with numbers and the alphabet, and we dump different generators at different numbers. In addition, we keep track of all of our inventory by computer."

This is becoming more common at many scrap yards, agrees Heenan. "If you visit yards, you see piles that are more segregated than they ever were in the past – the heavy melting’s over here and the factory bundles are over here, the galvanized is over there, the shredded is over here, the turnings are over here," he says. "In the past, you had a lot of mixed."

The David J. Joseph Co., like many scrap companies, has a large database of mill specification requirements. More difficult to obtain is a database of the supply side analyzing the content of scrap from various sources, especially since that content will change depending on where those sources buy their scrap. To combat this problem, the company works with its suppliers to encourage them to maintain the source integrity of incoming materials, and makes sure they receive some value for that.

Keeping scrap from various sources is not yet an actual trend, but it is likely to become one in the future because of consumer requirements, says Wulff. "The industry will increasingly move in that direction," he says. "There still will be commingling of material, because that’s the way it comes into the yards, in many cases, from peddlers and collectors. But what you don’t want to do is take that peddler scrap and put it in a pile with something that you know comes from another source, if you can, because then you’re degrading the value of the known scrap. You get it down to a common denominator which is less valuable."

Wulff agrees that there has to be a discipline of sampling and monitoring scrap at mills. "If you know what’s in the piles, then you know how much you can use in order to optimize its application and get the most value from the scrap you have," he says. "There has to be a discipline about sampling and then a discipline about blending the quantities that are used in mixing the heats for the furnaces."

SCRAP ANALYSIS

The David J. Joseph Co., like an increasing number of other scrap processors, has spectrographic labs at all of its mill sites. These labs sample material from all sources and maintain a database of the scrap being received, handled and blended for mills.

In theory, more low residual scrap could be recovered – if it were practical and the technology existed to do so at a reasonable cost, says Wulff. For example, shredded automobile scrap typically contains an average of about .25 percent copper. Copper is a residual element that presents a problem for steelmakers. But the steel in cars – body panels and frame members – is very pure, low-residual steel that only becomes contaminated during the shredding process.

"The copper comes in because of the wiring, primarily, that cannot all be removed economically in the shredding process today," he explains. "If there were a way to do that, or if it were worthwhile to sort it more carefully, and you could get to just the body panels of steel that come out of a shredder, you’d have extremely low copper, low-residual steel."

It comes down to value received for the product in the marketplace versus the cost of producing it, says Wulff. Although it is possible to get the copper content in shredded scrap down to 12 percent to 15 percent consistently, it costs more to do so. The market would need to reward this in order for it to become a widespread practice, according to Wulff. As for going beyond that level of purity, there are various technologies that claim to be able to, but they would have to be developed and commercialized.

"Perhaps more likely than other possibilities is that we will improve our ability to monitor the content of the scrap so that there will be much less guesswork involved on whether a given pile of shredded has 12 points of copper or 27," says Wulff. "We’ll be able to look at it and determine more reliably what its content is, and once you know what it is, you can know how to use it. You know if its 12 points and how to use it and you don’t have to act like it’s maybe got 27 and protect yourself."

New analytical tools are needed to do this, he adds, and some are already under development. "We’re developing some technology which we think will allow us to improve that, which we would probably keep proprietary," says Wulff.

There is very little room for error anymore in delivering scrap to mills, adds Macaluso, so scrap processors must know what their chemistries are and keep track of each mill’s specifications. In addition, processors must know their suppliers and the types of scrap they are delivering.

If a given load of scrap varies from a mill’s specs, he says, processors must at least know the chemistry of the material so they can give mills the choice of accepting it or not. Not all companies have spectrometers to help them determine exact chemistries, but his company is looking into getting one, both for ferrous and nonferrous, says Macaluso.

Large yards may have an advantage in the marketplace in having more resources to invest in spectrometers and other equipment, he says, but smaller yards that are determined will not be shut out. "Processors that want to compete will find a way to get what they need," he says.

SCRAP MANAGEMENT

The term "scrap management", says Wulff, which is often applied to these types of services, means different things to different people. For many, it means material handling, including inventory control, managing the stockpiles, unloading scrap, and minimizing demurrage on railcars.

"That’s not unimportant at all, but that’s not what we talk about when we talk about scrap management – we don’t limit it to that," he says. "We try to include in our scope of scrap management, beyond the material handling issues, the selection and the preparation of the material for the furnace; the development of the recipe. The steel mill tells us what chemistry of steel they want to make, and we give them the scrap to make that chemistry. And then in between those two extremes, there’s a range of services that people variously would call scrap management, so it’s one of those somewhat ambiguous terms."

Although spectrometers and other equipment for analyzing scrap chemistries are more common than they used to be in scrap operations, they are still more widely used for companies dealing with alloys and nonferrous scrap than those handling ferrous scrap, says Wulff. But even in operations with spectrometers, it’s necessary to take the process one step further. Once you understand the chemistry of the material, you need the knowledge of what to do with it – how to optimize its value in the steel mill’s furnace.

"To help us do that, we have six people on our staff who are metallurgists who came from the steel and foundry industry," he says. "They were melters of scrap, and now they work with us in our mill service area and with our customers – both producers of scrap as well as consumers. It has to be a collaborative venture here. So it’s not just a matter of the hardware and the tools, but also the intelligence that has to be brought to the issues."

Processors are becoming increasingly sophisticated in their ability to meet mills’ chemistries, and hiring metallurgists is becoming a more common practice, agrees SRI’s Heenan. "I’ve seen a number of people from the steel industry that have metallurgical degrees and metallurgical backgrounds – former chief metallurgists of melt shops – that have left the steel industry and gone to the scrap industry," he says. "If the scrap industry is going to do their job correctly, they need that talent. This is becoming the common practice rather than the exception."

The David J. Joseph Co. was prompted to step up its efforts in this area about 10 years ago in response to consumers’ calls for better quality scrap from processors, says Wulff. "Consumers were asking for better quality in their raw material, and most of us in the scrap industry didn’t know exactly what that meant," he says. "The general attitude was, ‘this is scrap, and you can’t have quality scrap – it’s an oxymoron, isn’t it?’ But consumers kept asking for better quality scrap, so we and others have realized that we need to understand what they’re talking about."

To become educated about their consumers’ needs and to work with both consumers and suppliers to meet those needs, his company hired their first metallurgist around 1985.

STILL LEARNING

Although the Southeast and the Southwest don’t yet have a lot of the new minimills making flat-rolled products and, as a result, requiring higher grades of scrap, scrap processors in all regions of the U.S. will eventually have to pay more attention to improving separation and sorting of materials, says Robert Melendi, vice president of marketing-ferrous sales for the Commercial Metals Co., Dallas.

"In the Southeast, there is the advent of three new flat rolled guys, but they haven’t really started buying much scrap yet," he says. "But as time goes by, in the Southeast, there will likely be a more aggressive approach to keeping scrap segregated."

In the end, regardless of how much processors improve scrap sorting methods and chemical analyses, quality will always be an issue because scrap is inherently inconsistent, says Wulff – it is not a manufactured product. Working with it is an ongoing learning process for the industry.

Although there will likely be more technology applied to the scrap industry in the future, there probably is not a breakthrough technology around the corner, he says.

"But I think you’ll find more applications of software and the development of more technical knowledge," Wulff speculates. "I think that in ten years it will not be unusual at all to see some suppliers in the scrap industry selling some packages of scrap to metallurgical specifications."