Hi Zhenghan,

D2 is the “Net” flow of recycled content. So the closed loop recycling process for steel actually includes the ‘recycled content’ of the steel as well as the end of life ‘Recycling Rate’. These two figures are connected to each other.

If you look at the default figures for Reinforcement Bar, you’ll find that the recycled content is at 95% when other steel products are typically at 40.33%. However at the end of the life of the reinforcement bar, the recycling rate is only at 80% which is less than the recycled content that went into making it in the first place.

The D2 impacts are showing a positive figure for reinforcement bar because it is getting penalised for the 15% ‘leakage’ in the supposedly closed loop recycling process. If you change the end-of-life recycling rate to 95% to match the recycled content, you’ll find that the D2 impacts for reinforcement steel drops to 0. However, we do not recommend doing that since the default figures are based on industry averages. This example is just to explain how it works.

I hope that answers your question!