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California Steel Mill to Recycle Nearly 500,000 Tons of Scrap a Year
Pacific Steel Group’s Mojave Micro Mill is set to become California’s first new steel mill in more than 50 years and, for the recycling industry, its most important feature may be what goes into the furnace: nearly half a million tons of California-sourced scrap steel every year.
By Paul Ploumis
Published October 14, 2026
Key Points
- Location: Mojave, Kern County, California.
- Developer: Pacific Steel Group.
- Opening: Commercial operations are targeted for 2027.
- Scrap consumption: Nearly 500,000 tons of California-sourced steel scrap annually.
- Rebar capacity: Up to approximately 450,000 tons per year.
- Feedstock: Shredded vehicles, appliances, structural steel, sheet metal and other prepared ferrous scrap.
- Investment: Recent estimates range from roughly $700 million to $800 million.
- Jobs: Kern County’s latest incentive agreement is tied to 450 new full-time jobs.
SEATTLE (Scrap Monster): California is preparing to restart large-scale steelmaking with Pacific Steel Group’s Mojave Micro Mill, a scrap-fed rebar facility under construction in Kern County.
The project broke ground in March 2025 and is expected to begin operations in 2027, making it the first new steel mill built in California in more than five decades.
While the project has received attention for its size, jobs and low-emissions technology, its potential impact on California’s scrap market is equally significant.
Pacific Steel Group says the facility will recycle nearly 500,000 tons of scrap metal sourced within California each year and produce as much as 450,000 tons of reinforcing steel at full capacity.
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For scrap processors, the Mojave project is not simply another steel mill opening. It represents a new large-scale buyer entering a state that currently has no comparable operating steelmaking outlet.
Pacific Steel Group says the mill expects to recycle nearly 500,000 tons of California scrap every year.
Kern County environmental documents identify potential feedstock including:
- Shredded automobiles
- Discarded appliances
- Structural steel scrap
- Sheet metal
- Prepared steel bundles
- Other processed ferrous scrap
That gives California recyclers something they largely do not have today: a large in-state steel consumer capable of melting locally generated ferrous material and turning it directly into finished construction steel.
The mill could therefore change the destination economics for certain California scrap flows.
Material that currently has to move longer distances to mills outside California or into export channels could instead have another domestic buyer much closer to where the scrap is generated.
This does not guarantee higher scrap prices. Buying values will still depend on steel demand, mill operating rates, freight, grade specifications and competing export bids.
But a new consumer approaching half a million tons of annual scrap demand is large enough to matter to regional processors, shredders and brokers.
Mojave Mill Will Melt and Roll Steel in California
The Mojave Micro Mill is being constructed on approximately 174 acres near Mojave and Rosamond in Kern County.
The permitted development includes roughly 550,000 square feet of mill and supporting structures as well as a 63-acre solar installation.
The plant will incorporate an electric arc furnace, ladle metallurgy equipment, continuous casting and rolling operations.
That allows the facility to take prepared scrap, melt it, cast steel and roll finished rebar within one integrated operation.
Pacific Steel has said it will be the only operating California plant capable of both melting and rolling steel products once production begins.
Up to 450,000 Tons of Rebar a Year
Pacific Steel Group currently says the Mojave operation will be capable of producing upward of 450,000 tons of rebar annually.
The finished product will primarily supply construction and infrastructure markets.
| Mojave Micro Mill | Planned Scale |
|---|---|
| Annual scrap consumption | Nearly 500,000 tons |
| Annual rebar capacity | Up to ~450,000 tons |
| Project site | 174 acres |
| Solar installation | 63 acres |
| Committed full-time jobs under county incentive | 450 |
| Target operating year | 2027 |
Project Cost Has Risen Sharply
The cost of the Mojave project has increased considerably since its earlier development stages.
California initially cited more than $540 million of committed capital investment when the project broke ground.
More recent reporting has placed the project at approximately $700 million to $800 million.
Pacific Steel Group Vice President of Mill Operations Mark Olson told local media in October that total investment had grown to roughly $800 million.
The different estimates reflect a project whose cost has continued to evolve during construction rather than a fixed figure that has remained unchanged since groundbreaking.
Kern County Incentive Is Tied to 450 Full-Time Jobs
Kern County recently approved an economic-development incentive worth up to $3.375 million for the project.
The agreement is tied to the creation of up to 450 new full-time, living-wage jobs.
California officials have previously cited a broader employment impact approaching 700 jobs, including electricians, millwrights, welders, automation specialists and computer-systems personnel.
Pacific Steel has also been working with regional colleges and universities to establish steel-manufacturing training programs.
California Has Not Built a New Steel Mill in More Than 50 Years
The Governor’s Office and Pacific Steel both describe Mojave as the first steel mill built in California in more than five decades.
Governor Gavin Newsom highlighted the project in his January 2026 State of the State address as an example of new manufacturing investment supported through California’s economic-development programs.
The state previously awarded Pacific Steel a $30 million California Competes tax credit tied to investment and hiring commitments.
Mill Will Use an Electric Arc Furnace
The project’s importance to recyclers comes from its steelmaking route.
The Mojave facility will use an electric arc furnace, or EAF, which melts recycled ferrous material using electricity rather than relying primarily on iron ore and coke in a traditional blast furnace.
Kern County’s project documents specifically describe the mill as a recycling operation using scrap from vehicles, appliances, construction and other steel sources.
This makes local scrap availability an important part of the mill’s future raw-material supply chain.
Solar and Battery Storage Will Support the Mill
Approximately 63 acres of the project site are planned for solar generation.
The California Energy Commission has also awarded Pacific Steel Group $14 million for a long-duration energy-storage project serving the mill.
The planned system is a 4 MW / 32 MWh vanadium-flow battery designed to integrate with the solar installation and electric grid.
Pacific Steel describes the facility as a “zero process carbon emissions” rebar mill.
That description is the company's characterization of its planned process. The project incorporates electrified steelmaking, renewable power, emissions-control technology, carbon capture and high-efficiency filtration, but its broader lifecycle emissions will also depend on electricity supply, transportation and upstream inputs.
Project Could Reduce Long-Distance Scrap Movements
California generates large quantities of obsolete vehicles, appliances, demolition material and other ferrous scrap.
Without a major operating steelmaking furnace in the state, processors have historically relied on customers elsewhere in the United States or overseas markets for significant portions of material.
Pacific Steel says one goal of the Mojave mill is to use locally sourced scrap rather than requiring that material to leave California before being converted into new steel.
That creates the possibility of a shorter loop:
California scrap → California steel mill → California rebar → California construction.
For a recycling market, that is a meaningful change in regional material flow.
Rebar Will Feed Infrastructure and Construction Markets
The mill's finished rebar is intended for roads, bridges, hospitals, commercial construction and other reinforced-concrete applications.
Pacific Steel already operates as a rebar fabricator and installer across the western United States, giving it a downstream customer base for the product it plans to manufacture in Mojave.
The mill therefore represents vertical integration: the company will be able to source recycled steel, manufacture rebar, fabricate it and supply or install reinforcing products for construction customers.
What Scrap Processors Should Watch
Scrap procurement: The most important recycling question is when Pacific Steel begins contracting meaningful volumes toward its nearly 500,000-ton annual feedstock requirement.
Grade mix: Shredded automobiles, appliances, structural material, sheet and prepared bundles are specifically identified in project documents.
California pricing: A new in-state mill buyer could affect regional competition for ferrous scrap, although the impact will depend on mill buying specifications and export-market conditions.
Freight: Processors located within economical trucking or rail distance of Mojave could gain another destination with lower transportation requirements than more distant mills or ports.
2027 commissioning: Construction remains underway, and the timing of actual melt-shop commissioning will determine when meaningful scrap demand enters the market.
Rebar demand: The mill’s utilization ultimately depends on construction and infrastructure demand for its finished product.
ScrapMonster Market Read: The Mojave Micro Mill matters more to the recycling industry than the headline that California is getting its first new steel mill in 50 years. At full operation, Pacific Steel expects to consume nearly half a million tons of California ferrous scrap every year. That creates a new domestic outlet for automobiles, appliances, demolition steel and other prepared material in a state without a comparable operating steelmaking furnace. The eventual price impact cannot be known before the mill establishes its purchasing program, but the direction of the material flow is clear: California scrap that previously had to travel farther to find a furnace will soon have a major new buyer inside the state.
Sources: Pacific Steel Group; Kern County Planning and Natural Resources Department; California Governor’s Office; California Energy Commission; Kern County economic-development records.
