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“Recycling is a key driver for change,” Khadr said.
“So many industrial fields will grow if we can make the best use of materials for recycling [and] knowledge for recycling will make a huge difference,” he said, pointing out the importance of processing not only scrap steel in Saudi Arabia, but also for critical metals like copper, silver and titanium.
Al Qaryan is the largest scrap processor in the Middle East, with branches both in Saudi Arabia and in the United Arab Emirates, handling ferrous, non-ferrous and non-metallic scrap such as tires, concrete and plastics.
It processes 1.5-1.7 million tonnes of steel scrap in Saudi Arabia per year, from a total market supply of 4-4.5 million tpy, according to Khadr.
Al Qaryan trucks loaded with ferrous scrap – and adorned with the company’s green-yellow-white branding – are a common sight on the drive up to major steel plants in the Kingdom.
Moreover, its steelmaking arm operates a 450,000-tonne-per-year steel billet-producing plant from two induction furnaces (IFs) in Dammam, eastern Saudi Arabia which started operations in 2017 and expanded capacity earlier this year.
At the heart of Al Qaryan Group’s strategy on recycling is its alignment with Saudi Vision 2030, which is the national blueprint for economic diversification, sustainability, and industrial development.
Saudi Vision 2030 entails a “need to improve industry, reducing the cost [and] targeting new segments which are already not manufactured in the Kingdom now… [including high tech materials] “especially alloys – reducing carbon [emissions] and securing our environment,” Khadr said,
Key steelmaking projects over the coming years look set to break new ground for Saudi Arabia, such as Al Watania’s plans to set up the Kingdom’s first tinplate production by 2027 and Wahaj Industry Co’s announcement that it will build a plant for electrical steel production.
Just 20 years ago, Saudi Arabia had no structured method of dealing with industrial waste or discarded tires, Khadr said, adding that recycling initiatives are now at the core of industrial policy, supporting environmental protection and resource efficiency.
The Saudi Investment Recycling Company (SIRC), which is a wholly owned subsidiary of the Public Investment Fund (PIF), had signed a raft of deals develop and finance waste management and circular economy projects in Saudi Arabia.
These deals include investments in facilities for refuse-derived fuel for kilns, recycling end-of-life tires and developing production of sustainable aviation fuel (SAF) in the Kingdom.
Under Vision 2030, Saudi Arabia is rolling out a series of major infrastructure projects including the NEOM smart city in the northern Tabuk Province, the Mukaab cubed skyscraper complex in Riyadh and the Red Sea Project on the west coast, all of which will require huge volumes of steel.
Given rising ferrous scrap consumption, demand for greater transparency from market participants in Saudi Arabia’s steel sector had also risen over the last two years.
This led to Fastmarkets’ launch of the world-first Saudi Arabian ferrous scrap index, earlier this month.
The Fastmarkets’ launch is a positive development for the industry, according to Khadr, because the greater transparency given to the sector will make the Saudi Arabia market more attractive for investors both domestically and internationally.
“As you put your market in [greater] transparency and clear vision – for both the internal market and outsiders – it will encourage investors,” he said.
“[Similarly], the most attractive countries for investors and growth [have greater] transparency”, he added.
The index, which uses Fastmarkets’ proprietary tonnage-weighted calculation models, incorporates prices for HMS 1&2 ferrous scrap from key markets in the east, center and west of the Kingdom to produce a composite price index denominated in Saudi Arabian riyals per metric tonne on a delivered basis.
Al Qaryan Group is able to analyze the current steel markets in Saudi Arabia from a unique perspective given its role as both scrap processor and steelmaker in the Kingdom.
One of the reasons for higher scrap demand over recent years, is due to a rise in induction furnace (IF) capacity, according to market participants, while supply has become comparatively tight versus demand levels.“Supply of ferrous scrap is quite tight in the Kingdom at the moment. IFs are now estimated at 35% of steel production [and] all of this manufacturing is increasing our capacity for production, increasing the needs from the scrap,” Khadr said.
Certain steelmakers and government officials have expressed concerns over the operations of some of these IF mills amid fears of reduced steel quality and creating extra competition for raw materials, according to market sources.
Some IF operators are now planning to switch to more advanced electric arc furnace (EAF) plants over the coming years, sources told Fastmarkets.
If you go with EAFs, you reduce your cost, [and] your liability for the scrap, because you can deal with several materials like direct reduced iron (DRI) or pig iron,” Khadr said.
“The market is not like before. It is very tough now, there is a huge production [capacity] in the market… To compete, you must develop your industry [using] a modern furnace,” Khadr added.
Tightness in the Saudi market is compounded by rising energy, fuel, and logistics costs, according to Khadr, with diesel prices rising by more than 40% in January 2025.
“All these elements are impacting the cost- and the conversion cost now is the big challenge for every producer in the market,” Khadr said.
Fastmarkets’ weekly price assessment for steel reinforcing bar (rebar), domestic, delivered Saudi Arabia was 1,930-2,150 riyals ($514-573) per tonne on August 18.
By comparison, Fastmarkets’ assessment of the steel scrap HMS 1&2 index, domestic composite, delivered Saudi Arabia was 1,447.39 riyals per tonne on August 19, marking a premium for rebar of 483-703 riyals ($128-187) per tonne.
Saudi steelmakers had traditionally aimed for a margin of $250 per tonne, a major mill source told Fastmarkets last year, thereby making current margins very challenging.
With scrap prices high and steelmaker margins squeezed on their finished steel sales, some mills have sought alternatives such as direct reduced iron (DRI) or imported billets this year, according to industry sources.
Saudi Arabia imported around 1 million tonnes of billets in January-June 2025, according to market sources, undercutting local scrap demand.
In order to unlock greater value from recycling and maximize possible supply volumes, Al Qaryan had invested heavily in specializing in new processes in recent years.
“Three years ago, we saw demand in the market from huge [scale] demolitions and nobody in the market was specializing in [handling these projects],” Khadr said.
“We are now targeting this [market] with a new arm of the company,” Khadr added.
This strategic arm is now tasked with the full cycle – from evaluation and value estimation of recyclable materials to the demolition and responsible recycling of materials, according to Khadr.
Khadr said the approach allows Al Qaryan to maximise recovery from industrial projects and deliver turnkey solutions for complex demolition assignments, which are increasingly common as Saudi Arabia embarks on ambitious infrastructure and industrial projects.
“If you have the expertise to treat such projects, it’s not only building demolitions,” Khadr said.
Major infrastructure and industrial projects across the country, such as water solutions plants, pipelines and sugar refineries, have all provided fertile ground for Al Qaryan’s demolition expertise.
“Specialist processes should be taken to secure a high-safety workspace to be sure this will not harm the environment,” he said.
Al Qaryan’s journey mirrors the ambitions and challenges of Saudi Arabia itself: scaling up, modernizing and becoming a global industrial heavyweight.
With the company continuing to develop its recycling, and steel production capabilities, it is set to remain at the forefront of Saudi Arabia’s industrial transformation – helping to build a circular, efficient, and sustainable future for the kingdom.
Want to learn how scrap metals and recyclable materials are driving the circular economy? Explore our scrap and secondary hub for more.