We have tried to develop the following new material processing for the production of value-added materials from by-products such as kish-graphite, Fe & Cu mixed scraps etc. in steelmaking processes : 1) Production of PdCl2 graphite intercalation compound (PdCl2-GIC) in hydrothermal conditions to create nano-particles encapsulated in kish-graphite. 2) Application of "unusual wetting" of liquid Cu on surface-oxidized Fe to produce composite materials between Cu and ceramics.