Spoils of War
Just finish rereading The Two Towers.

So Eomer and Co wiped out Ugluk et al. They burn the bodies... and leave the equipment behind.

Recently I watched a documentary how African people used to smelt iron ore in a simple bloomery. It was really hard work! A lot of charcoal, a lot of sweaty bellowing, to get some lumps of iron the size of half my fore arm. 

Iron was very labour intensive to make! And therefore not cheap. I remember also reading about the Trojan War, when Achilles held a chariot race during the funeral of Patroclus. One of the prizes was a large chunk of iron.

So if I were in Eomer's posse, I'd be tempted to carry off a bundle of orc daggers. Maybe I'd give them to a blacksmith to reforge into carpentry tools or hoes or arrowheads.
"A Iluvatarinya! En na pelecco carinyesse!"
"Oh my God! There's an axe in my head!" :worry:

You'd think if nothing else they'd want to deny Orc weapons to other potential baddies! I agree, iron shouldn't be so cheap and common it could be just discarded!

As to offering a prize of iron during the Trojan war, that was the late Bronze Age, and metallic iron was very scarce and precious, generally obtained from iron meteorites. An iron-bladed dagger was a remarkable item in Bronze-Age Pharaoh Tutankhamen's stash of grave-goods because it was so rare in that era, much as millenia later an aluminum ingot was included with 18th cent. French crown jewels!
Many Defeats & Many Fruitless Victories Memoirs Gateway
For I was talking aloud to myself...the old...choose the wisest person present to speak to...
The fact anyone figured out how to smelt iron amazes me. However, techniques improved over the millennia. There are quite a few videos on YouTube that show how iron ore was processed at various stages in history. Here is a pretty cool video from Holland.

Watch Medieval Iron Production in Holland Thijs van de Manakker - smelting ore from YouTube
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Now, the Romans took smelting to an industrial level. They literally had massive industrial complexes where iron was mass-produced and worked.

I imagine Tolkien felt the orcs would have had an industrial process as well. Saruman, after all, filled the pits of Isengard with machines and fires. So while many people may assume that is an anachronism in Tolkien's fiction, it's probably not that far from realistic ancient historical fact.

That said, smelting was absolutely a labor-intensive task and ancient armies often equipped themselves from the spoils of war. Chain armor was highly valued, of course, and it was taken taken again and again and reused or repurposed until it couldn't be used again.

Any sufficiently time-consuming process can be scaled up if you have enough labor available.

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