The fire broke out at the Maitland Road property just before 11.30am, sending a large volume of black, toxic smoke into the air, FRNSW said.

Firefighters from 11 stations have responded to the scene, hitting the blaze with hoses from three sides.

Two large aerial platforms were also being used along with cranes to try to break up the pile of scrap, measuring about 100m by 50m - and 10m to 15m high.

Firefighters said there were concerns about LPG and oxygen cylinders stored on site.

Newcastle police in a message on social media on Sunday morning urged motorists to avoid the area while the emergency response was taking place.

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