In the past steel manufacture caused a lot of environmental problems.
However recently the steel industry has cleaned up its act. Almost all of
the pollutants steel manufacture generates have been greatly reduced in the last ten years or so.

More scrap steel is being recycled than ever before. This means less waste is produced and less energy is consumed. Using scrap steel
instead of using iron ore reduces the energy needed by a factor of 2.5 per tonne.

In addition, iron oxide dust is being recycled in steel production. In the early eights steel works would emit thousands of tonnes of this dust on to the neighbouring towns. In the U.K. alone dust emissions have fallen by 57%.

Not only dust levels, but also gaseous emissions of carbon dioxide, sulphur dioxide, and oxides of nitrogen from steelworks have been
substantially reduced compared with the levels of 30 years ago. In the U.K. steelworks reduced carbon dioxide emissions (a contributor to global warming) by 37% between 1980 and 1990. Sulphur
dioxide emissions, a major source of acid rain, were reduced by U.K. steelworks by 60% between 1980 and 1990, and now represent less than 3% of the United Kingdom's total sulphur dioxide
emissions. In Japan emissions of sulphur dioxide at the Keihin Works have been reduced by a factor of 24 in the past 30 years. Similar
reductions are now being achieved at most steelworks in industrialized countries, as well as substantial reductions in the former Soviet Union and Eastern and Central Europe.

However, steel is still a fossil-fuel based industry. The production of steel is only at best 45% efficient, where it is more commonly 35% or below. Even using electric furnaces still indirectly causes pollution.

There may still  be some problems steel production causes, but it  is no longer the threat it once posed.