CONSULTING AGREEMENT

Exhibit 10.1

CONSULTING AGREEMENT

between

SCHNlTZER STEEL INDUSTRIES, INC.

and

Gary A. Schnitzer

For Work Generally Entitled

General Consulting Services

CONSULTING AGREEMENT

1. Scope of Agreement; Work Statements. SSI hereby engages Consultant, as of the Effective Date set forth above, to provide consulting services and advice to SSI. Consultant hereby agrees to provide such consulting services and advice, in accordance with the Work Statement and any additional Work Statements that may be signed by SSI, acting through its Authorized Representative (as provided in Section 12 below), and Consultant while this Agreement is in effect. Each Work Statement will become a part of this Agreement after execution by both parties.

2. Fees and Expenses. SSI shall compensate Consultant for the services specified in each Work Statement in accordance with the fee provisions set forth therein. Consultant agrees that such compensation constitutes full and complete compensation for Consultant’s services and for all obligations assumed by Consultant under this Agreement. Consultant shall issue an invoice for services rendered in accordance with the applicable Work Statement which includes a sufficient description of the days or partial days worked and the corresponding services rendered in accordance with the payroll and internal audit requirements of SSI. Payment terms are (30 days) after receipt of correct invoice by SSI. Consultant will be responsible for payment of all income, social security and other taxes assessed against fees paid by SSI to Consultant hereunder.

3. Confidentiality. In the course of providing services to SSI, it is anticipated that Consultant may acquire knowledge (orally, by visual observation, or in writing) of information considered by SSI to be confidential and proprietary, including without limitation, that regarding: (a) matters of a technical nature such as know-how, formulas, trade secrets, secret processes or machines, inventions or research projects; (b) matters of a business nature such as information about costs, profits, pricing policies, markets, sales, suppliers, customers, plans for future development, plans for future products, marketing plans or strategies; and (c) other information of a similar nature not generally disclosed by SSI to the public, all of which information is referred to collectively hereafter as “Confidential Information.”

Consultant agrees that during the term of this Agreement Consultant will (1) keep secret and retain in the strictest confidence all Confidential Information, (2) not disclose Confidential Information to any third party unless such disclosure is specifically authorized in writing by SSI, and (3) not use any Confidential Information for any purpose other than performance of services for SSI. Consultant further agrees to deliver promptly to SSI upon termination of this Agreement, or at any time that SSI may request, all memoranda, notes, records, reports, manuals, drawings or other documents (and all copies thereof) relating to SSI business, and all property associated therewith, that are in the possession or under the control of Consultant.

4. Ownership of Copyrights. Any original works of authorship, including any written, pictorial, graphic or audiovisual work or sound recording, conceived or created by Consultant under this Agreement shall be the property of SSI, and Consultant hereby assigns and agrees to assign to SSI all of Consultant’s rights, including the rights of copyright, in the works. Consultant will execute all documents and perform all acts that SSI may reasonably request in order to assist SSI in perfecting its rights in and to the works developed under this Agreement anywhere in the world, and SSI will reimburse Consultant for any expenses reasonably incurred by Consultant in so doing.

5. Inventions. Consultant agrees to disclose promptly to SSI all inventions or improvements made or conceived, either alone or jointly with others, during the term of this Agreement and for six (6) months thereafter as a direct result of the services provided or Confidential Information obtained by Consultant during the term of this Agreement or any extension thereof. Consultant will upon request assign to SSI Consultant’s entire right, title and interest in and to any and all such inventions and improvements. Consultant further agrees to execute all documents and provide such other assistance as may be required for SSI to obtain, maintain and protect patents on such invent