"C-50" is a type of steel. I go from memory, but I believe it is a German (DIN) nomenclature, no longer (officially) in use, as it has been superseded by the EN (European) Standards, but unofficially (and in fact) very much alive.

From your context, I think tha they refer to what is also called "troquelín" in the trade (in Spanish). That refers to the reject after die-stamping parts out of a continuous strip of steel (in this case, C-50 steel grade): You punch your part through the band and the remainder is scrap.

However, this is quite valuable to recyclers, as it is scrap of a very defined composition, and the cast-iron foundries, which use non-descript scrap iron / steel as their main raw material value especially this type of scrap, for obvious reasons.

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Note added at 55 minutos (2009-06-24 15:33:01 GMT)
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btw, Kate, this is my speciality, not the "bolsillos de plastrón" (aka patch pockets), for instance... but I learned the translation from you.

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Note added at 13 horas (2009-06-25 03:53:13 GMT)
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Of course, you may say "scrap", rather than byproduct (and it is a better rendering, too, in this context). Thanks, slothm