Greenflation

"Greenflation" is a word combination of  "Green", which implies consideration for the environment (such as decarbonization), and "Inflation", which is an economic term for rising prices.  Greenflation refers to inflation that can be associated to measures against climate change. 

As an example for steel products, supply shortages and price increases can be traced back to China, which has the highest crude steel production worldwide, taking drastic measures to reduce carbon dioxide (CO2) emissions and improve air quality with governmental  penalties and incentives for fewer electricity consumption and less air pollution. This is resulting in manufacturers reducing their production volume, and renewing equipment with  electric furnaces, which are said to have less environmental impact than often used blast furnaces. It can also be assumed that the rising scrap prices are caused by the shift in production corresponds to green blast furnace.

In the future, it can be expected that the transfer of R&D costs required for the transition of blast furnaces to other technologies to product prices may also be a factor of greenflation. The issue remains on how to connect the rise in prices to the rise in income and to realize a virtuous cycle of the economy.