NORTH AMERICAN AUTOMOTIVE METALS www.steeltimesint.com January/February 2016 - Vol.40 No.1 TESTING & ANALYSIS HANDLING DIRECT REDUCED IRON PERSPECTIVES Q&A Ferro-alloy optimisation and laser measurement techniques explained Online billet length measuring improves furnace availability Exploding the myths and highlighting the realities behind DRI Denmark-based Danfoss Drives says the need for steel won’t disappear STEEL TIMES INTERNATIONAL – January/February 2016 – Vol.40 No.1
Exploding the myths and highlighting the realities behind DRI
Denmark-based Danfoss Drives says the need for steel won’t disappear
STEEL TIMES IN
TERNATION
AL – January/February 2016 – Vol.40 No.1
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There was a time when the government – or the ‘powers that be’ – could be trusted with the welfare of the people. When I was a kid I had a kind of blind faith that those elected to run the country (and the world) were intelligent human beings who had the greater good of the people at heart. If we invaded a sovereign nation, we had good reason to do so; if we closed a hospital it must have been because it presented a public health risk and if we incarcerated a body of people it wouldn’t be before they were all given a fair trial in front of a jury.
Today, I’m not so sure if any of the above still ring true – or whether they ever did. In his latest book, The Road to Little Dribbling – more Notes from a Small Island – Bill Bryson sums it up nicely: “In countless small ways the world around us grows gradually shittier.”
The political landscape of the 21st Century is characterised by ‘career politicians’ and self-interest rather than a sense of philanthropy and well-being. Most tellingly, however, it’s all about greed. Iraq wasn’t about saving the world from weapons of mass destruction; it was about oil and construction contracts and
now, of course, it’s all back-fired as Islamic State runs amok and refugees risk life and limb, on choppy seas, to reach Europe.
In short, there is plenty to be concerned about; and that common theme running through most episodes of the X-Files has returned to haunt us – ‘trust nobody’.
I am constantly wracked with suspicion over the motives of the British Government, the European Parliament, whoever is in the White House and, lately, the World Trade Organisation.
It has been made abundantly clear that bestowing ‘market economy status’ upon the Chinese will be disastrous for the global steel industry and the livelihood of those employed by it. And yet, an online report by Reuters has confirmed my worst fears.”Although fierce debate is raging, all signs point to the EU accepting China as a market economy after December 2016.”
Why is it that Chinese steel companies are not bothered about making a return on capital? Because they can rely upon the support of the state. Tata Steel UK, of course, isn’t so lucky because the government’s hands are tied by EU state aid rules – meaning that it will sit idly by and do nothing. Disgraceful.
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Chinese eliminate steel capacityFigures issued by the Ministry of Industry and Information Technology (MIIT) on Christmas Eve last year indicate that China eliminated 17Mt of steel-making capacity in 2015. It is expected to have eliminated 13Mt of iron-making capacity, 300kt of electrolytic aluminium capacity, 38Mt of cement capacity and over 11 million weight carbons of flat glass capacity. According to the MIIT, China is expected to resolve 15Mt of excessive shipbuilding capacity.
Source: China Metals
Chinese crude output down 1.71%The daily crude steel output of China’s major steelmakers averaged 1.57Mt during the first 10 days of December 2015, down 1.71% from the period 21-30 November 2015, according to figures issued by the China Iron and Steel Association.
Steel stocks held by China’s major steelmakers totalled 14.3Mt, down 0.16% when compared with end-November figures.
Source: China Metals
Ansteel president under suspicionChen Guofeng, president of Ansteel Group Engineering Technology Development, is under investigation for being suspected of serious discipline violations.
Chen is also the assistant to the general manager of Ansteel Group, a major state-owned Chinese steelmaker.
Source: China Metals
Tata’s Scandinavian service centresTata Steel has acquired two service centres from SSAB and bought a third service centre in Scandinavia.
The three centres are located in Halmstad (Sweden) Naantali (Finland) and Frederikstad (Norway) and, claims Tata Steel, will offer cut-to-length, slitting and recoiling services to the steelmaker’s customers in the automotive, construction and electrical industries.
According to Tata Steel, ‘having sites in these important regions gives us the opportunity to offer local expertise to customers combined with the backing of a larger, European-wide distribution network and an integral steel supply.”
More jobs to go at Tata Steel
Emissionsreduced
More jobs are to go at Tata Steel in the UK and in terms of culprits, it’s the usual suspects – the flood of steel imports from China being a major factor, but also a strong pound, punitive business rates when compared to those of France and Germany and high energy costs.
Gareth Stace, director of UK Steel, has been quick to point out that the latest job losses are ‘a wake up call again to government’ and Alan Coombs, president of the Community union in Port Talbot – where an estimated 750 jobs will be lost – wants tariffs imposed on Chinese steel and lower business rates.
The latest round of job cuts – roughly 1,050 will go in total – follows hot on the heels of cuts made last year by Tata Steel. In October, the company announced that 1,200 jobs would be axed in Scunthorpe and Lanarkshire.
“These job losses are a real setback to the Welsh economy and it’s clear that firms in our steel industry face major global challenges to stay competitive," said Emma Watkins, director of CBI Wales.
“Chinese steel imports look to be having a big impact and it’s important that the European Commission urgently reports back on whether the market has been distorted unfairly by excess market supply," Watkins said.
According to Watkins, “Our industrial base can best be supported by developing a long-term industrial
strategy, protecting research and development investment to help raise productivity and making energy costs more competitive."
Watkins said that the Welsh and UK governments must work together and alongside business to develop 'new and compelling' offers for inward investment and extra support.
The job cuts announced today have fired up the UK-based Leave.EU campaign. A spokesman for the organisation said, “In our view this is a predictable consequence of politicians’ failure to address the EU elephant in the room, with further job losses in Scotland and the north of England inevitable.”
"This latest round of job losses in Wales will set alarm bells ringing in Scotland and the north of England. Sadly, further losses are inevitable because the EU elephant in the room
remains deliberately unaddressed, with the Welsh First Minister even going so far as to claim that the terrible problems faced by steel workers have 'nothing to do with' the EU last week".
Workers at Tata Steel’s Scunthorpe long products plant will avoid the latest round of cuts, thanks to a deal struck with Greybull Capital that has been ‘virtually sealed’ according to the Scunthorpe Telegraph. That said, 900 redundancies will go ahead at the plant despite a planned £400 million investment by Greybull.
Potentially, there is worse to come. In December this year a decision will be made as to whether China should be granted market economy status (MES). If the decision goes in favour of the Chinese, anti-dumping measures that currently safeguard hundreds of thousands of EU jobs against unfair competition from China across a range of strategic industries will become ineffective overnight.
China is placing political pressure on national and EU policymakers to prematurely grant MES, arguing that the WTO protocol assures its MES by the year-end. “However, the WTO protocol was established under the presumption that China would make sufficient progress towards becoming a market economy; progress that it has studiously failed to implement,” according to Axel Eggert, director-general of EUROFER, the European Steel Association.
Russian steelmaker NLMK has launched what it regards as ‘an important environmental project’ at its Lipetsk site.
The project, which involves the reconstruction of de-dusting sys-tems at the company’s 3.2Mt/year blast furnace number six, will result in more than six-fold reduc-tion in dust emissions from the furnace, reducing dust emissions by more than 20%.
The plan is to replace several de-dusting systems at the casting yard, the trestle, the receiver and the breeze bins at Lipetsk as well as installing ‘next generation’ bag filters in place of the current elec-tric filters.
Shandong Iron & Steel Group Rizhao has ordered two twin-strand continuous slab casters from Primetals Technologies. Both casters will be installed at the Chinese steelmaker’s high quality steel plant in the Rizhao coastal region of Shandong Province and are designed to produce 4.6Mt (metric tons) of slabs per annum.
The two machines will be fed with steel produced in basic oxygen steel con-verters with a total annual capacity of 5Mt (metric tons). Primetals’ ‘Connect & Cast’ principle will be employed for the installation of the casters, which will go on stream in June 2017.
‘Connect & Cast’ means that all plant functions and systems are ready for use from the very first batch.
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5 INDUSTRY NEWS NEWS IN BRIEF
MES for China? No, not yet...On the day that the European Par-liament debated the subject of MES for China, EUROFER’s director-gen-eral Axel Eggert insisted that China is not yet a market economy and that there is still too much state in-volvement.
“The EU has set out five criteria establishing how China could be considered to be a market econo-my. Presently, the country meets just one of these conditions,” he said.
According to Eggert, China is placing political pressure on na-tional and EU policymakers to prematurely grant MES, arguing that the WTO protocol assures its MES by the year-end. “However, the WTO protocol was established under the presumption that China would make sufficient progress to-wards becoming a market econo-
my; progress that it has studiously failed to implement,” Eggert said.
EUROFER argues that if China was granted MES, the anti-dump-
ing measures that safeguard hun-dreds of thousands of EU jobs against China’s unfair competition across a range of strategic EU in-
dustries would become ineffective. The EU’s other trade defence meas-ures are either inoperative or sim-ply insufficient to defend against the rising tide of dumped Chinese products, particularly steel.
Eggert concluded, “Despite those that believe the EU must give China favourable terms, the fact remains that China already has a favourable commercial position: the EU’s total goods trade deficit with China was around 137 billion Euros in 2014, a figure expected to grow 30% larger for 2015.”
He said that the EU must think long and hard about the political direction of the EU’s trade rela-tions with China or face the poten-tial demise of the sector on which Europe was built – the European steel industry.
TMK ships premium pipeRussian steelmaker TMK, which claims to be one of the world’s leading producers of tubular products for the oil and gas industry, has shipped premium pipe products with lubricant-free coating GreenWell for LUKOIL-Nizhnevolzhskneft.
The supply included 32 tonnes of 177.8 mm P110-grade casing pipes and pipe nipples with TMK UP PF ET premium connection.
Tata and SNCF rail dealA new deal between Tata Steel and the French national railway company SNCF means that Tata’s Long Products Europe business will continue to supply the rail operator for the next five years.
While Tata has been SNCF’s main rail supplier since 1999, the contract can be traced back 130 years.
The new contract has a four-year extension clause option.
Gérard Glas, Tata Steel’s rail sector head, said the new contract provides a ‘valuable foundation’ for the company’s future order book.
Metal shows increase frequencyGIFA, METEC, THERMOPROCESS and NEWCAST – four leading and inter-linked metals industry events – are switching to a three-year cycle and will next be taking place in Dusseldorf, Germany, from 26-30 June 2018.
Organiser Messe Dusseldorf said that ‘these leading trade fairs have already adapted to the changes in their industries’ innovation cycles on several occasions’ and continue to produce ‘exceptionally good results’.
The most recent events (in June this year) attracted 78,000 visitors from more than 120 different countries and 2,214 exhibitors.
America in discussions with ChinaThe global and challenging issue of Chinese steel overcapacity has yielded an important step forward, according to the AISI’s president and CEO Thomas J Gibson, following a meeting between the American and Chinese governments in China.
According to Gibson, high-level meetings between the two countries resulted in the two governments agreeing to hold further talks this year.
Korean steelmaker Hyundai has start-ed up a continuous bloom caster and long product rolling mills at its plant in Dangjin.
The caster has a capacity of 1.1 Mt/yr (metric tons) and a large bar mill at the plant produces 1Mt/yr (metric tons) of end products and billets for a small bar and wire rod mill.
Both the caster and the mill were
started up last October (2015) and were supplied by Primetals Technol-ogies, who were awarded the order early in 2014.
Hyundai Steel is part of Hyundai-Kia Automotive Group and runs six pro-duction facilities in South Korea.
The caster incorporates Primetals Technologies’ Mold Expert monitoring system.
The automotive sheet business has been kind to Russian steelmaker Magnitogorsk Iron & Steel Works (MMK).
The company reports that shipments to foreign carmakers with localised production in Russia have increased dramatically when compared with 2014 figures.
Car manufacturing, claims the company, is one of the most prom-ising and attractive segments and it is hoping to significantly strength-en its position in the sector.
MMK intends to be the number one supplier to Russia’s domestic car manufacturing industry over the next decade as well as a key supplier to the three leading for-eign brands producing cars in Rus-sia.
MMK’s production capability for high-quality rolled products has been significantly expanded, ac-cording to the company. Enlarge-ment of the company’s Chelyab-insk Mill 2000 cold-rolling facility means that MMK can meet the strictest quality standards for both cold-rolled and hot-galvanised products.
Car plans of MMK
Following the installation last month of a new Energiron DRI plant at Egypt’s Ezz Rolling Mills (ERM), the company reports that the plant has passed its perfor-mance test one month after start-up.
According to leading Italian steel production technology pro-vider Danieli, ERM’s new cold DRI plant, featuring ENERGIRON lll technology, produced its first DRI on 22 November and passed the hot test on 2 December.
Limited national gas forced the plant to work at a reduced rate followng completion of the hot test, despite the fact that it was ready to increase productivity.
Natural gas availability was re-stored on 14 December and the plant was ramped up to full pro-ductivity, starting its performance test the following day and per-forming well above its target fig-ures. Danieli claims that produc-tivity was 112% of the guaranteed value.
Fast start-up for DRI plant
Industry news new file.indd 2 1/25/16 12:36 PM
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6 INDUSTRY NEWS
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Green issues delay projectsThe Indian Parliament has been informed that as many as 23 steel projects across India, including those of Tata Steel, JSW Steel, Es-sar Steel and Posco’s JV in Mahar-ashtra, are being delayed for envi-ronmental reasons.
“Presently, 23 steel projects are pending due to grant of environ-ment clearance. Out of which, two steel projects are from Maharash-tra,” Indian Minister of State for Steel, Vishnu Deo, said in a written reply in the Indian parliament at New Delhi on December 21, 2015.
In addition to environmental concerns, the steel sector is also suffering from overcapacity issues – particularly in China – as global demand for steel shrinks.
Global prices under pressure
Aceria de Angola is the name of an ambitious US$300 million pri-vate steel project in Angola, funded by K2L Capital, which will produce 250kt of steel per year during its first phase, and ultimately will negate the need for Angola to import steel.
The project is part of K2L Capi-tal’s growing portfolio of ventures in the region and has been ap-proved by His Excellency José Edu-ardo dos Santos, President of the Republic of Angola.
K2L claims that the new steel plant will produce over 300kt of steel rebar when in full produc-tion, which is roughly how much Angola has been importing.
K2L’s remit is to build a better Africa and support Angola in its plan to diversify its economy in the midst of an oil crisis.
The company’s chairman and CEO, Georges Choucair, described the ADA steel project as ‘part of the road to economic diversifica-tion’. He said it would bring a new and dynamic industry to Angola
Angola’s steel ambitions
that was not related to oil and gas and would save US$200-300 in foreign currency reserve for the Angolan National Bank.
The ADA project represents the largest private investment in the region. It will create 600 direct jobs and 3,000 in-direct jobs.
The quality of the steel pro-duced is certified by European and Western standards and is en-vironmentally responsible, meet-ing all the requirements of the US, EU and World Bank, accord-
ing to K2L.“The economic, social and de-
velopmental aspect of this project is unparalleled, providing health-care, education, water and hope for thousands while building new communities in an ongoing effort to make Angola self-sufficient,” a K2L spokesman said.
According to K2L, the commu-nity around the factory now has access to clean water, a train-ing centre, health centre and electricity.
ArcelorMittal Belval of Esch-sur-Alzette in Luxembourg, has started up a CRS Compact Roller Straightener supplied by SMS Group of Germany. It took only four weeks to dismantle the plant’s old equipment and install the new model, which can handle the largest sheet piles currently produced in the world, claims SMS.
The scope of the supply included the mechanical equipment, electrics and automation plus the media sup-ply systems and all the roller change machinery.
According to SMS, CRS straighteners have been used successfully by nu-merous rolling mills for sections and semi-finished long products.
International steel prices remained under pressure in December, due to sluggish global demand and high inventories.
According to MEPS Internation-al Steel Review, world steel prices slipped further across flat and long product areas.
In North America, flat prices continued to weaken amid lack-lustre demand domestically while a strong US dollar hampered ex-ports. Buyers are delaying purchas-es as they prioritise their year-end stock positions.
Chinese spot prices have reached record lows with local producers selling excess stock at discounted prices. With demand slowing down domestically, China continues to pitch its exports at re-markably low prices. Subsequent-ly, steel mills have cut domestic selling values in Taiwan and South Korea.
However, US flat prices may have bottomed out as many do-mestic steel mills have announced price increases for the first quarter. At this stage, it is unclear whether the price hikes will be accepted by the market.
Source: MEPS International Steel Review
Shanxi Haixin Iron and Steel Group is expected to resume production early this year (2016) following on from its acquisition last September by Beijing Jian Long Group.
Once China’s largest steelmaker, Shanxi Haixin halted production in March 2014 due to excessive ca-pacity in the domestic steel indus-try, a sluggish steel market climate and financial strain.
Prior to closure, Shanxi had an annual capacity of 5.6Mt (metric tonnes) of iron, 6Mt of steel and 5.2Mt of steel products.
Since the takeover the compa-ny has been renamed and is now Shanxi Jian Long Iron and Steel Company.
Production to re-start
Geert Van Poelvoorde, executive vice president of ArcelorMittal and CEO of Flat Carbon Europe, has been elected EUROFER president.
Mr Van Poelvoorde takes up the post immediately and will remain president for the next two years. He takes over from Robrecht Him-pe, who was EUROFER’s president from 2014 onwards.
“Mr Van Poelvoorde’s leader-
ship will ensure EUROFER can con-tinue to support the steel industry in facing economic and policy challenges,” said Axel Eggert, di-rector-general of EUROFER.
Mr Van Poelvoorde said, “I would like to thank Mr Himpe for his outstanding commitment to the organisation during his tenure, and for his tireless efforts in build-ing EUROFER’s reputation.”
New president for EUROFER
Industry news new file.indd 3 1/25/16 12:36 PM
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7INDUSTRY NEWS
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DIARY OF EVENTS
For a full country-by-country listing visit:www.worldsteel.org/statistics/crude-steel-production.html
Crude production down 2.8%February 2016
24 EEF National Manufactur-ing Conference, QEll Centre, London, UK. Organised by the EEFKey themes up for discussion include the UK’s future in the EU, unlocking the global trade challenge, the Apprenticeship Levy: tax or talent generator? And cracking Britain’s productiv-ity puzzle. High-profile speakers include: Rt Hon Sajid Javid MP, Secretary of State for Business, In-novation and Skills; Tom Watson MP, Deputy Leader of the Labour Party; Martin Wolf CBE, chief eco-nomics commentator, The FT.
Details, log on to http://www.manufacturingconference.co.uk
March 2016
1-3 China Iron Ore 2016Grand Millennium Hotel,Beijing, China. Organised by Metal Bulletin EventsOrganised in conjunction with the China Minmetals Corporation, China Iron Ore 2016 looks at the pressures affecting the iron ore sector of the commodities market as prices fall and demand slows.
How much of new supply will come on stream between 2016 and 2018? Will India resume its iron or exports?
For further details, log on to www.metalbulletin.com/events/
8-10 American Metal Market’s 9th Tube & Pipe ConferenceDoubletree Houston Greenway Plaza Hotel, Houston, Texas, USA. Organised by MetalBulletin Events.
Billed as America’s largest gath-ering for the steel, tube and pipe industry, this event will examine the latest news on anti-dumping trade cases and debate how the industry can survive in an envi-ronment of lower prices. New projects and capacity will also be under discussion along with the latest trends and outlook for the American oil and gas industry.
The last event attracted 416 delegates from 235 companies based in 20 countries.
For further details, log on to www.metalbulletin.com/events/
World crude steel production reached 1,622.8Mt for 2015, down by -2.8% compared to 2014.
Annual production for Asia was 1,113.8 Mt of crude steel in 2015, a decrease of -2.3% compared to 2014. China’s crude steel produc-tion in 2015 reached 803.8 Mt, down by -2.3% on 2014. China’s share of world crude steel produc-tion increased from 49.3% in 2014 to 49.5% in 2015. Japan produced 105.2 Mt in 2015, down by -5.0% compared to 2014. India’s crude steel production for 2015 was 89.6 Mt, up by 2.6% on 2014. South Korea produced 69.7 Mt of crude steel in 2015, a decrease of -2.6% compared to 2014.
In 2015, the EU (28) produced 166.2 Mt of crude steel, a decrease of -1.8% compared to 2014. Ger-many produced 42.7 Mt of crude steel in 2015, down by -0.6% over 2014. Italy produced 22.0 Mt in 2015, a decrease of -7.1% over 2014. France’s crude steel produc-tion in 2015 was 15.0 Mt, down by -7.2%. Spain produced 14.9 Mt of crude steel in 2015, an increase of 4.4% compared to 2014.
Crude steel production for 2015 in North America was 110.7 Mt, a decrease of -8.6% compared to 2014. The US produced 78.9 Mt of crude steel, down by -10.5%.
The CIS showed a decrease of -4.3% in 2015, producing 101.5 Mt of crude steel. Russia* pro-
duced 71.1 Mt of crude steel, down by -0.5% on 2014 and Ukraine recorded a decrease of -15.6% with a year-end figure of 22.9 Mt.
Annual crude steel production for South America was 43.9 Mt in 2015, a decrease of -2.5% on 2014. Brazil produced 33.2 Mt in 2015, down by -1.9%.
In December 2015, world crude steel production for the 66 coun-tries reporting to the World Steel Association was 126.7 Mt, down -5.7% compared to December 2014. The crude steel capacity utilisation ratio was 64.6%, 4.9 percentage points lower than De-cember 2014. The average capac-ity utilisation in 2015 was 69.7%.
Finished steel consumption in Lat-in America and the Caribbean was down 2% for the period January to October 2015 when compared with the same period in 2014.
The region produced 53.7Mt of crude steel and Brazil accounted for 53% of regional production (28.2Mt and an annual contrac-tion of 1.2%).
The region produced 44.9Mt of finished steel, down 4% on the previous year’s figures and with Brazil as the main producer (accounting for 19.3Mt – 43% of output).
Mexico was the second biggest producer and accounted for 33% of regional output with its 14.7Mt of production.
Finished steel production for the region reached 57.9Mt – down
3%. Mexico recorded the largest increase in consumption, up 9% or 1.6Mt. Chilean consumption was also up 9% and Argentina’s was up 3% having produced 115kt more steel when compared to the same period in 2014.
Rolled steel consumption in Brazil was down 3.3Mt and there were declines of 4% and 15% re-spectively in Columbia and Peru.
Latin America imported 20.3Mt of finished steel, a rise of 1% over the January to October 2014 pe-riod. Imports account for 35% of regional finished steel consump-tion.
Latin America exported 7.5Mt of finished steel, an increase of 8% year-on-year, and recorded a trade deficit for the period of 12.7Mt (finished steel) and this repre-
sented a trade imbalance 3.6% lower than during the same peri-od in 2014 when the figure was 13.2Mt.
A trade surplus was maintained by Brazil alone (1.4Mt) while the largest deficit was recorded by Mexico (down 5.7Mt). Columbia followed (- 1.9Mt), Chile (- 1.5Mt) and Peru (- 1.2Mt).
Figures for November 2015 show that crude steel production reached 5Mt, down 7% on Octo-ber 2015 and 4% less than No-vember 2014. Finished steel pro-duction closed at 4.6Mt.
Over the first 11 months of 2015, crude steel production in the region totalled 58.7Mt. Pro-duction of finished steel reached 49.5Mt.
Source: Alacero
Finished steel production down 2%
EUROFER, the European Steel As-sociation, welcomes the fact that a global agreement has been reached on climate change, but says that it lacks a comprehensive strategy as to how to achieve its intended objectives.
Axel Eggert, director-general of EUROFER, said that while the agreement – if correctly imple-mented – would tread ‘the right path towards mitigating anthro-
pogenic climate change, it ‘didn’t create the much-needed level playing field because third country competitors ‘will continue to face far lower environmental burdens’.
According to Eggert, “Europe’s steel industry is amongst the cleanest and most advanced in the world. If it collapses due to ‘carbon leakage’ – compounded by ongo-ing unfair trade practices from non-EU countries – then Europe
will simply have exported its CO2, as well as hundreds of thousands of jobs,” he said. Eggert said that, ‘as long as no equal measures exist for industrial competitors globally, the Emissions Trading System (EU ETS) will have to be shaped in a way that guarantees – at least at the level of the 10% most effi-cient steel plants in Europe – that the system does not result in any costs.”
EUROFER applauds climate deal
Industry news new file.indd 4 1/25/16 12:36 PM
USA UPDATE8
www.steeltimesint.com January/February 2016
Tough times for US Steel
* USA correspondent
THE downturn has washed some of the sheen off the Carnegie Way, pursued by Longhi, which, in his own words, would make US Steel capable of “earning the right to grow.”
Nevertheless, such measures have, apparently, not brought the company out of the loss-making zone.
US Steel’s problems have been compounded by heavily discounted prices forced by cheap imports, the greenback’s appreciation against most international currencies, a sluggish energy market that buys less of steel tubing and a global steel glut. Many analysts have been saying that US Steel will report a loss for the entire year 2015 which would mean, if this prediction is proved right, that the company would not have earned any profit for the sixth time in seven years. But some analysts credit Longhi with having, at least, prevented a worsening of the company’s losses.
Invariably, attention turns to what some critics describe as the “China effect”, a euphemism that suggests China’s steel dumping practice in the US market is largely to blame for the industry’s woes. US Steel has also been adversely affected by a sharp decline in steel prices following a flood of foreign imports. Many analysts, however, are applauding the company’s move to cut off its “sick Canadian limb”, as some call its failed Canadian operation.
US Steel and its Canadian associate US Steel Canada have decided to part company after the Canadian chapter was forced to file for relief from its creditors. This followed unsuccessful attempts to sell the Canadian company. Many say this may spare US
Bad news about US Steel has intensified by the day. Chief executive and president, Mario Longhi has frozen the pension fund, cut off the Canadian subsidiary by filing bankruptcy, closed down steel-production and finishing operations at Fairfield, Alabama, saved over $800 million by rescinding a problem project in Gary, Indiana, and generated some $600 million in annual savings from his ‘Carnegie Way’ initiative. But is he happy? By Manik Mehta*
Steel from pumping money into what is described as a “bottomless barrel”. There is also the argument that by severing its Canadian links, US Steel can concentrate on its US operations unlike in the past when it was sending business across the border to sustain the existence of the Canadian company. US Steel will have a dual benefit: it will not have to continue carrying the financial burden of its Canadian facility, and it will properly utilise capacity at its US-based operations.
US experts hailed his decision as “wise and practical” arguing that steel mills are expensive to operate. Steel mills are productive as long as their capacities are fully utilised, they argue.
The surge in foreign steel imports, mainly of Chinese origin, has reduced the capacity
of US mills to about 70%, and has driven prices sharply lower. Many steel products cost about $200/tonne less than they did a year ago. Indeed, analysts say that some prices are at levels not seen since the 2003 steel recession, which wiped out several big producers.
The US International Trade Commission (ITC) is expected to decide in December and January whether to impose duties on these imports. The higher the duties or margins, the more the sanctions will curb imports.
“If positive results come from these trade cases, it could help the industry out,” according to Matt Miller, a metals analyst with S&P Capital IQ.
There is a general feeling in US steel industry circles that regardless of whether US steel companies make money or not, China will continue to produce, and get rid of its excess production, in overseas markets, particularly the US, because it enjoys the unfair advantage of being subsidised by the Chinese government.
The US dollar’s appreciation – accompanied by the devaluation of the Yuan – also helps Chinese steel producers who enjoy a better cost structure when their currency depreciates in relation to the dollar.
The general feeling within the US steel industry is that China is always doing something to undermine the rules of the level-field playing game. But seeking redress against Chinese dumping practices – and also against tariffs imposed by them against some speciality products – can be an arduous and protracted process, taking years to resolve.
Gary Hubbard, a spokesman for the
USA new.indd 1 1/22/16 10:50 AM
USA UPDATE 9
www.steeltimesint.com January/February 2016
United Steelworkers International Union in Washington DC, has called for efforts to “defend your market or they’ll steal it from you.”
The USW has supported the ATI and AK Steel in filing a complaint against China for dumping electrical steel on the US market. That case is pending an appeal before the ITC.
The disproportionate supply-and-demand situation – excessive capacity and declining demand – has had an adverse effect on the steel industry.
The global steel glut has had a strong negative impact on AK Steel Holding, a Fortune 500 steelmaking company, which is now slashing jobs, cutting expenses and struggling to keep sales and profits up. AK Steel sources hope that a balanced supply-demand situation emerges, with improvement coming from capacity reductions not only in the US but globally.
Worldwide steel production has risen by about 46% from 2005 to 1.8 billion tons in 2014, according to the American Iron and Steel Institute (AISI).
During that period, steel imports into the US market surged 38% from 32.1Mt in 2005 to 44.3Mt in 2014. Finished steel imports into the US so far this year, have been growing at about 3% ahead of last year, surpassing what was already a record year for imports in 2014, according to the AISI.
The steel industry was “under attack” from the surge in foreign imports, Lisa Harrison, spokeswoman for the AISI, said.
She also blamed “foreign government subsidies and other trade distorting practices” for the problems in the steel industry which are fueling the surge and causing US producers to idle facilities and lay off workers.
Besides AK Steel and US Steel, which have taken measures to slash costs, trimming production and other operations and doing away with “excess fat”, Nucor also felt the squeeze on its profits in its most recent earnings release on 22 October, noting a 69% decline in overall operating rate at its steel mills over the three months ending 3 October. A year ago, Nucor reported its mills were running at 81%. It also warned stakeholders that the end of the year would be tough too. “A slowing economy in China is causing further global overcapacity and resulting in significant levels of steel imports into the US market,” the company said in a statement.
AK plans to temporarily idle the blast furnace of a Kentucky steel mill, citing imports and unfair trade concerns. Ashland Works employs a total of about 940 workers, but the number of jobs affected has not yet been determined, according to the company.
The steel industry derives comfort from political statements issued by leading political personalities, including Presidential candidates, as the country enters the candidate selection phase of the two leading parties, with each carefully calibrating comments to appeal to voters.
The debate has become lively with remarks, sometimes not so restrained, by Republican presidential candidate Donald Trump who said on 10 November that he would have China declared a “currency manipulator”, a call often made by the steel industry. Beijing’s “great wall of protectionism” used unlawful tariffs to keep US companies out and tilt the playing field in its favour.
“The worst of China’s sins is not its theft of intellectual property, but the wanton manipulation of China’s currency, robbing Americans of billions of dollars of capital and millions of jobs,” Trump recently wrote in his usual blunt style in an op-ed in The Wall Street Journal. Such views seem to resonate well with American steel workers and also steel companies. t
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LATIN AMERICA UPDATE 11
www.steeltimesint.com January/February 2016
How hot is Chile’s steel industry?
* Professor in economics, Federal University of Uberlândia, Brazil. E-mail: [email protected]
CHILE is usually considered the best Latin American nation regarding competitiveness. According to the Global Competitiveness Index (GCI), developed by the World Economic Forum (WEF), Chile is currently ranked in 35th place, among 140 countries. It is important to stress that Mexico is in 57th position, followed by Colombia (61st), Peru (69th), Brazil (76th), Argentina (106th) and Venezuela (132nd). The complete list of the Latin American nations is shown in Table 1.
Chile is a very open economy, applying an average import tariff of 6%. Moreover, since 1996, it has celebrated various Free Trade Agreements (FTAs), including: Pacific Alliance, Turkey, Australia, Japan, Colombia, Peru, China, United States, South Korea, European Union, Mexico, Canada and Mercosur (see the whole list of the FTAs and the Preferential Trade Agreements in Table 2). This high openness cannot be dissociated from the fact that its economy is greatly dependent on mining, in general, and copper in particular.
After a military dictatorship during the period 1973-1990, Chile developed a quite democratic and stable political system. Despite the differences concerning ideological orientation, the governments typically adopted ‘responsible macroeconomic policies’. Nonetheless, Chile’s economy is adapting to a more
Chile’s open economy and highly competitive industrial environment points to a healthy steel industry, but this is not the case according to Germano Mendes de Paula*
adverse external scenario, derived from the slowdown in China’s economy and lower copper prices. GDP growth nowadays is lower than during the commodity boom, as can be observed in Fig 1. The bank Itaú forecasts that the Chilean economy will expand 2.5% in 2016, in contrast with over 5% registered over the period 2010-2012.
Fig 2 shows that the nominal exchange rate varied from 624 Chilean Peso (CLP) per $ at the end of 2008 to 470 CLP as of late 2012, representing a strong currency appreciation. Since then, it engaged in a depreciation trend, which might bring the exchange rate to 715 CLP by year-end 2016. Although this tendency helps the local industry (against imported goods), a higher inflation is a collateral effect. It is estimated that 4.8% consumer inflation in 2015 – considerably lower than a 15.5% currency depreciation – can be partially explained by declining international oil prices. However, a
credible inflation target and low public debt leave Chile better placed to face the external shock in contrast to its Latin American peers. In this context, someone might expect that the Chilean steel industry is performing quite well, but this is not the case.
Steel industry performanceFig 3 summarises the evolution of the Chilean steel market over the 2007-2015 period. It is fair to avoid paying attention to the 2009-2010 period, as Chile was an outlier due global steel turmoil. Apparent steel consumption in Chile increased from 2.3Mt in 2007 to 3.0Mt in 2013, reverting to roughly 2.5Mt in 2015 (an estimation recently released by the Latin American Steel Association/Alacero). Simultaneously, finished steel imports skyrocketed from 0.9Mt in 2007 to 1.7Mt in 2013, declining marginally to 1.6Mt in 2015. Meanwhile, the import penetration ratio was equivalent
7
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Fig 1. Chile’s GDP growth (%)
Fig 2. Nominal exchange rate
(CLP/$), at the end of the
period, 2007-2016
Fig 3. Chile’s monthly ship-
ment of rebar, 2007-2015 (kt)
LA new.indd 1 1/25/16 3:03 PM
LATIN AMERICA UPDATE12
www.steeltimesint.com January/February 2016
Free trade agreements
Agreement/Partner(s) Date of Signature Date of Entry into Force
Pacific Alliance 10 February 2014 20 July 2015
Thailand 04 October 2013 05 November 2015
Hong Kong, China 07 September 2012 29 November 2014
Vietnam 12 November 2011 04 February 2014
Malaysia 13 November 2010 18 April 2012
Turkey 14 July 2009 01 March 2011
Australia 30 July 2008 06 March 2009
Japan 27 March 2007 03 September 2007
Colombia 27 November 2006 08 May 2009
Peru 22 August 2006 01 March 2009
Panama 27 June 2006 07 March 2008
China 18 November 2005 01 October 2006
New Zealand, Singapore and Brunei Darussalam 18 July 2005 Various
European Free Trade Association (EFTA) 26 June 2003 01 December 2004
United States of America 06 June 2003 01 January 2004
Republic of Korea 15 February 2003 01 April 2004
European Union (EU) 18 November 2002 01 February 2003
Central America (Costa Rica, El Salvador, Guatemala,
Honduras and Nicaragua) 18 October 1999 Various
Mexico 17 April 1998 01 August 1999
Canada 05 December 1996 05 July 1997
MERCOSUR 25 June 1996 01 October 1996
Preferential Trade Agreements
Agreement/Partner(s) Date of Signature Date of Entry into Force
Ecuador 10 March 2008 05 January 2010
India 08 March 2006 17 August 2007
Bolivia 06 April 1993 06 April 1993
Venezuela 02 April 1993 02 April 1993
Argentina 02 August 1991 02 August 1991
Source: Organisation of American States
Table 2. Chile’s free and preferential trade agreements
to 38% in 2007, 57% in 2013 and 63% in 2015. Despite registering strong variation, exports were relatively modest (70kt/yr on average).
Fig 3 also demonstrates the evolution of production. Concerning pig iron, it oscillated around the 1.1Mt/yr plateau over the period 2007-2012. Nevertheless, in 2013, Compañia de Acero del Pacífico (CAP) decided to interrupt its operations dedicated to flat steel production. As a result, the company, which has the only coke-integrated mill in the country, shut down one of its two blast furnaces.
Pig iron output dropped to 0.6Mt in 2014-2015. The company unveiled that one blast furnace will be idle until 2018, at least. Crude steel production (CSP) was around 1.6Mt/yr between 2007-2012. Due to CAP’s aforementioned decision, Chilean CSP plummeted to 1.3Mt in 2013 and to 1.1Mt in 2014-2015.
Flat steel production was equivalent to 551kt in 2007, 412kt in 2012 and 189kt in 2013, when the country stopped fabricating such products. CAP’s installed capacity was reduced from 1.45Mt/yr to 0.7Mt/yr, employing just one blast furnace. The company made a strong adjustment to its industrial processes and labour force.
In reality, CAP continues to be a player in the flat steel business, but now it depends only on imports. The company claims to be the largest steel importer on the Pacific coast of South America. Its processing division sales (including operations in Peru
Table 1. Latin American countries in the Global Competi-
tiveness Index (GCI)
Country Ranking
Chile 35
Panama 50
Costa Rica 52
Mexico 57
Colombia 61
Peru 69
Uruguay 73
Brazil 75
Ecuador 76
Guatemala 78
Honduras 88
Trinidad and Tobago 89
El Salvador 95
Domenican Republic 98
Argentina 106
Nicaragua 108
Bolivia 117
Paraguay 118
Venezuela 132
Haiti 134
Source: World Economic Forum (WEF)
LA new.indd 2 1/25/16 3:03 PM
LATIN AMERICA UPDATE 13
www.steeltimesint.com January/February 2016
and Argentina) maintained its volume around 400kt/yr from 2012 to 2015. Consequently, CAP’s fl at steel operations were transformed from a producer into an importer.
Relative stabilityLong steel production has been relatively stable around 1.0-1.1Mt/yr for most of the analysed period, with the obvious
exceptions of 2009 and 2010. CAP and Gerdau are the only domestic producers, with respective production shares of roughly 70% and 30%. Gerdau is focused on attending to the construction sector (rebar, in particular), whereas CAP has a higher degree of product diversifi cation. According to the latter, the resilience of long products demand is mainly explained by the need for grinding media supply to
the mining sector. As can be verifi ed in Fig 3, the country’s monthly shipment of rebar diminished from 64kt in October 2012 to 33kt in July 2015, recovering partially to 52kt in October 2015, which is the latest available data.
In an attempt to protect long steel producers, in October 2015, the Chilean government imposed a temporary safeguard (for 200 days) of 37.8% on wire rod. The measure applied to all countries, with the exception of Canada, Mexico and Peru (due to the FTAs) and developing nations, which have lower than 3% participation regarding Chile’s wire rod imports. While this affects numerous countries, the evident target is China, which detains an 83% share of all Chilean long steel imports. Wire rod accounts for 20% of CAP’s production.
Considering that Chile is a very open economy, the adoption of this safeguard could be interpreted as a sign that the government wants long steel domestic production to survive, avoiding a repetition of the same fate that has befallen fl at steel operations. �
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CHINA UPDATE14
www.steeltimesint.com January/February 2016
Chinese steel consumption falls
* Matthew Moggridge, editor, Steel Times International
2015 steel consumption in China is likely to fall by 4.8% year-on-year to 668Mt, it’s first fall since 1995, according to a report by the China Metallurgical Industry Planning and Research Institute (CMIPRI) in early December.
Domestic steel demand in China will shrink further in 2016 to 648Mt – a drop of 3%.
China’s crude steel output and iron ore demands are expected to be 806Mt and 1.12 billion tonnes respectively in 2015 and 781Mt and 1.073 billion tonnes in 2016, according to the CMIPRI.
Li Xinchuang, head of the CMIPRI, said that the fall in steel consumption was due to the economic ‘new normal’ in China and a general slowdown of the steel industry’s downstream sectors.
Slowing property investment and weakening manufacturing are also cited as root causes of the Chinese steel industry’s woes, according to the CMIPRI.
On a global level, world steel demand is expected to fall 2% in 2015 and a further 0.9% in 2016 to 1.51 billion tonnes and 1.5 billion tonnes respectively.
Looking at the situation sector-by-sector, steel consumption in the Chinese machinery industry is likely to fall 6.5% and in the construction sector by 7.2% . A fall of 7.7% is likely in the railway industry.
Large and mid-size Chinese steelmakers lost a total of 38.6 billion yuan (US$5.9 billion) between January and October 2015, according to the China Iron and Steel
Association (CISA). During the first 10 months of 2015,
medium-sized and large steelmakers lost 72 billion yuan (US$11.34 billion) according to CISA.
Of 101 steel mills tracked by CISA, the average sales margin stood at minus 1.5% between January and October 2015. In October it declined further to minus 5.37%.
Reduced profits for steelmakers have forced smaller players to exit the market.
CISA claims that 48 of the 101 tracked large and mid-sized steelmakers were in the red between January and October 2015 and that during the first three quarters of the year they incurred losses in the region of 28.1 billion yuan (US$4.3 billion).
Stainless steel woes The bad news keeps coming as six Chinese stainless steel manufacturers agreed to slash production by 30% from December 2015.
It is claimed that eight or nine out of every 10 stainless steel producers in China are currently in the red and forced to reduce production. Some have been cutting production since August/September last year. Output has been falling from Q3 2015 having risen month-by-month during the first six months of the year. In October, output declined 9.53% year-on-year.
Xu Lejiang, chairman of China’s Shanghai Baoshan Iron and Steel Co, speaking at a news conference in Shanghai towards the end of last year, said that China will experience troubled times based on excess
production capacity between 2016 and 2020 (China’s 13th Five-Year Plan period). Unlucky for some, perhaps.
China’s 13th Five-Year Plan will focus heavily on environmental protection, placing additional pressure on steelmakers and jeopardising the very existence of smaller, less financially assured producers. Many steelmakers have looked to diversify their operations by launching downstream projects and investing in emerging industries rather than relying upon the lower profitability of mainstream steel production.
Heartening news for the ‘rest of the world’ steel industry, however, is the recent announcement by CISA that China intends to enhance communication and strengthen co-operation with international steel industry associations with a view to safeguarding the international steel trade and promoting its healthy development going forward. China’s move was in response to recent accusations by European and US steel associations that China was the chief culprit behind the global industry’s massive overcapacity problems and the resultant plant closures and job losses witnessed around the world.
Chinese crude steel output for the first three quarters of 2015 was down 2.14% year-on-year to 610Mt. Apparent consumption declined 5.82% over the same period. t
Source: China Metals
Steel consumption is set to fall across many of China’s industrial sectors and steelmakers are bracing themselves for reduced profits. For the ‘rest of world’ steel industry, greater communication with China might help to allay fears going forward.
CHINA new.indd 1 1/22/16 10:54 AM
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FORSTESCUE Metals Group Ltd (FMG) (ASX: FMG) entered into an agreement with Australian Aboriginal Mining Corporation Pty Ltd (AAMC). Key to the development is FMG providing AAMC with access to its infrastructure, with AAMC consequently able to deliver up to 2Mt/yr from its existing projects to FMG’s port or rail facilities for a five-year period.
The amount of ore that can be delivered to the rail facilities will be determined by FMG taking into account a range of factors including the prevailing rail volume and any potential for surplus capacity. Additionally, FMG may either purchase ore directly from AAMC at the point of delivery or transport, market and sell it on behalf of AAMC.
Fergus Campbell, executive director of AAMG, spoke to Steel Times International about the many factors that will combine to make the new venture a success. He identified as essential: “A mature and supportive Pilbara iron ore industry that understands that there will be iron ore mining in the Pilbara for potentially centuries to come and that it must continue to work hard at improving outcomes for all of its stakeholders and most importantly the traditional landowner groups on which mining projects sit.”
In addition, there must be “a company like AAMC that seeks to engage with Aboriginal businesses because it understands that this improves its chances of securing support from within the industry, access to infrastructure and commercial success.” This, in turn, must be supported by: “infrastructure-owning companies that support the long-term advancement of Aboriginal stakeholders and community groups.”Campbell turned to the geological aspects
that will enable the project: “Quality iron ore resources, like the Extension and Breakaway resources, that are intrinsically low-cost as a result of material properties, strip ratio, hydro-geological conditions and ore quality and that are also close to existing infrastructure and that could be exploited profitably at current market conditions if access to that infrastructure were secured.”
AAMC’s resources are the Channel Iron Deposits that are typical of those at the BHPB Yandi and Rio Tinto Yandicoogina mines, which share the same genesis. Iron content is typically ~57% and with an LOI of ~10% the calcined iron grade is ~63%.
In resource terms, Campbell explains, “Reserves are currently ~20Mt but we have good exploration potential that could see significant reserve growth as a result of AAMC’s early success in identifying more than 10 new discovery areas on AAMC’s existing tenements.”
As to how much quicker the ore can be transported through the FMG link, Campbell comments: “This is not a timing issue. Without an agreement with one of
the big three Australian iron ore miners, AAMC would not have a port or rail solution, so it would not have a business model at all. Securing an agreement with Fortescue has delivered AAMC a business solution. Processing of the ore will take place on AAMC’s Extension project.”
AAMC welcomes a group of seed investors who believe in AAMC’s Aboriginal engagement strategy and are prepared to make significant commercial investments to advance an iron ore project in preparation for Aboriginal investors to be brought in – and who are then prepared to see their equity proportion in the business decline when this strategy is successful.
Customers are in place for AAMC’s iron ore. This is because, as Fergus Campbell points out: “… the agreement with Fortescue is an iron ore sales and purchase agreement that includes AAMC selling ore directly to Fortescue as it is delivered to Fortescue’s infrastructure.”
Australia is set to host its first Aboriginally-owned iron ore mine, with many key factors set to combine to make this aspiration a reality. t
IRON ORE16
www.steeltimesint.com January/February 2016
An aboriginal-owned iron ore mine
* Mining correspondent
Following a commercial agreement between two mining enterprises, the Pilbara region in Western Australia will soon host the first Aboriginally-owned and operated iron ore mine in Australia. By Michael Schwartz*
Iron ore mining
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AUTOMOTIVE 19
www.steeltimesint.com January/February 2016
DEARBORN is an industrial city near Detroit, Michigan, in the USA and last year it played host to the North American Automotive Metals Conference.
The conference’s 157 delegates included 42 from outside of the USA, 13 from Canada, seven each from Mexico and the United Kingdom, three from Japan, two each from Brazil, South Africa, South Korea, Taiwan and Turkey, one from France and one from Italy.
Background noteFor 25 years, from 1985 to 2010, fuel economy regulation for ‘light vehicles – passenger cars and small trucks (or ‘pick-ups’) – remained unchanged in the USA at 29.5 miles per gallon (12.5 km per litre). Fears of excessive dependence on imported oil then moved the US authorities to give producers of light vehicles 15 years to improve average fuel economy to 54.5 miles per gallon (23.15 km per litre). To achieve this ambitious goal, car manufacturers must develop more efficient
engines and transmissions, streamline their car bodies and, most important of all for metal producers, make their vehicles lighter.
Steel producers, the principal metal suppliers to the automotive industry, knew they had to turn out lighter and stronger steels to help the carmakers achieve the higher standard. Even so, they were prevented from going all out in this endeavour by safety rules issued to protect persons inside the vehicles from frontal and side-impact collisions. Another constraint on so-called ‘lightweighting’ was the added cost imposed on the car companies, especially in the case of cars expected to be purchased by persons with low or medium incomes. The cost of such vehicles had already been driven up by the public expectation to have items previously available at extra cost become standard equipment.
The steel industry’s public relations experts realised that the car companies might decide to substitute a large amount of automotive steel with aluminum (Al),
the natural ‘light metal’ often referred to as the ‘miracle metal’. The Al industry would be vulnerable if the environmental authorities decided to assess not just the pollution—and CO
2 generation—when vehicles are actually in use (by measuring tailpipe emissions) but accept the larger concept of ‘life cycle assessment’, which also includes the pollution caused in the production phase of the vehicles and of all the materials of which they are made. The production of Al requires a huge amount of electric power. Steel industry experts calculated that in its production phase Al generates four to five times more CO2 than steel. Thus Al’s poor showing in the production phase easily overwhelms its advantage in the use phase. The Al industry fought back, especially the Canadians, who produce more of that metal than their US counterparts, all of it with hydro-generated electric power. The debate has become a publicity battle between the two industries.
The steel versus aluminium tug-of-war was only one of the topics discussed at this
Lighter, stronger metal on the pedal
* Global correspondent
The North American Automotive Metals Conference, organised by American Metal Market and Metal Bulletin, took place on 2-3 September 2015 in Dearborn, near Detroit, Michigan, USA. It attracted 157 delegates and one of them was Steel Times International’s Hans Mueller*
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www.steeltimesint.com January/February 2016
conference. Others were the outlook for the North American (NA) light vehicle market, production and metallurgy of new types of steel, processing problems encountered with high-strength steels, advances in the production of Al and in laboratory testing of corrosion in Al alloys, the future demand and capacity of both Al and advanced high-strength steel (AHSS) and the use of magnesium in NA light-vehicle production.
The ‘lightweighting’ challengeThe conference opened with a keynote panel at which executives of both car companies and metal suppliers were present. P. Friedman of the Ford Motor Co. and C. Horvath of General Motors commented that they closely followed their suppliers’ pace of innovation, but what influenced them most of all were the purchasing choices of their customers. Dr. P. Rastogi of AK Steel looked at several phases of automotive production where steel has long been used and then made a wave-of-the-arm observation that the use of advanced high-strength and ultra high-strength steels alone would be capable of achieving the required weight reductions to raise the average light vehicle fuel economy to the mandated 2025 level. J. Dickson of Rio Tinto Alcan contributed the equally partial observation that the large weight reductions demanded in this case cannot be achieved without the greater use of Al, – or ‘magic metal’ as he put it. B. Keeler of Timken Steel opted to stay out of the fray, saying that the highly specialised nature of his company’s engineered products, such as crankshafts and pinion gears, ruled out any experimentation with substitute materials.
A delegate inquired whether the car manufacturers would not prefer it if their steel and Al suppliers came out of
their foxholes, shook hands and together developed superior joining methods for automotive materials. The question received favourable comments from GM’s Horvath and Alcan’s Dickson to the effect that modern society ranked innovation above rivalry, while Mr. Friedman and Dr. Rastogi agreed on the need for more research on the bonding of different materials.
D. Richman of Kaiser Aluminum and the Aluminium Transportation Group provided a detailed description of the NA Al industry. Upon listing the qualities of Al in effusive terms – strong, tough, formable, energy-absorbing, corrosion-resistant – he showed consumption estimates for the region of the North American Trade Trade Agreement (NAFTA) as well as global and NAFTA capacity numbers.
According to Mr. Richman, 2.31Mt of total NAFTA capacity is located in the USA, 2.81Mt in Canada. Furthermore, 75% of the primary NAFTA smelting process is hydro-powered. In that case, 5 kg of CO
2 are generated per kg of Al by mining, hauling, etc. The remaining 25% of smelting in the NAFTA region is based on fossil fuels and produces 20 kg of CO2 per kg of Al. Advanced Al alloys can be targeted to achieve either maximum strength, energy absorption or formability.
In the view of S. Ulnick and A. Abraham of the research and forecasting firm Ducker Worldwide, “the new advanced grades of steel are cost-effective solutions for weight savings” whereas the use of Al leads to higher incremental costs. But certain Al processes are nonetheless attractive to car producers. For example, the net vacuum die casting process turns out thin-wall, high elongation parts that reduce the complexity of designs, thereby saving weight and costs. The Ducker experts expect the automotive
use of advanced steel grades to rise from 125 kg/vehicle in 2015 to 219 kg/vehicle by 2025. The use of Al would increase from 179 kg/vehicle to “227kg plus/vehicle”. They also evaluated the performance of three bonding methods – spot welding, rivet bonding and adhesive bonding – with respect to their reliability, cost, quickness, ‘repairability’, as well as skill and capital requirements.
Extra cost to the consumerJ. Schuster of LMC Automotive estimated that the modifications required for compliance with the 2025 mandate will cost US new car buyers an additional $5,000. His annual growth forecast for light vehicle sales during the next five years was 4% for the USA, 1% for Canada and 11% for Mexico. In the USA the steep drop in fuel prices stimulated short-term demand for large pick-up trucks. However, over the next several years it will be compact SUVs that will set sales records. Automatic transmissions will go to 10-speeds, electric vehicles and hybrids will gradually expand their share of the market, and by 2018 NA will go through a recession of limited duration.
The chairperson of the next session was a Canadian, M. Hartlieb, an executive with the Al industry of Quebec (by far the largest in Canada). He compared lifetime energy consumption and CO2 generation of steel-intensive vehicles with Al-intensive vehicles in the USA and Canada. The speaker at this session was Dr. J. Hall, an executive at a research institute affiliated with the US steel industry’s trade association. She presented the results of an identical comparison but limited to the USA. The Canadian study found that Al-intensive vehicles do less harm to the environment – in the US study that result was claimed by steel-intensive vehicles. However, due to the different regions and pollution estimates, a simplistic comparison of the results is of little value.
Supply chain issuesM. Chamberlain of the London Metal Exchange told of a warehousing problem that had caused delays and long queues in Al ‘load-out’ rates. It required a thorough reform of warehousing rules to alleviate inordinate queuing and undesirable differentials in contract prices.
The development of advanced steels is absolutely necessary to fend off substitute materials. But new grades of steel, with their superior strength and ductility, often
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AUTOMOTIVE Hans.indd 2 1/22/16 2:17 PM
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have characteristics like excessive springback and poor formability for which the car industry’s existing tools and process lines were not designed and operators lack the proper training. D. Kanelos of Nucor explained the steps that need to be taken to cope with these problems, including the acquisition of more capable machinery, the harmonisation of testing procedures with partner companies, training workshops for the workers of supply-companies and the transfer of technology to some suppliers.
In the last session of day one, T. Duff of Worthington Steel spoke about the importance of constant collaboration with all customers. Worthington is a leading multi-material distributor and processor (pickling, annealing, cold-rolling and galvanising). The fi rm has made increasing use of its collected data for the purpose of ‘predictive modelling,’ i.e. learning the customers’ pattern of actions and reactions to anticipate their needs before the customers themselves have identifi ed them. Moreover, distributors must have a robust sales and operations system that can buffer or work around unforeseen fl ow variations and disruptions on both the demand and supply side.
NAFTA shines on MexicoThe fi rst session of day two put the spotlight on the rapidly expanding Mexican car industry. The chairperson, L. Alvarez of Industria Nacional de Autopartes, voiced his concern about Japan’s position at the Trans-Pacifi c Partnership negotiations. Mexico, Canada and the USA proposed a 50% regional content rule in the value of vehicles, whereas Japan has insisted on 30%. Parts makers from many countries have been fl ocking to Mexico and the industry now employs a workforce of
724,000 people. Adoption of the 50% rule would raise the number to nearly one million by 2025. The 30% rule would lower it to little more than half that number.
The fi rst speaker was F. Leal of Ternium, a large producer of fl at-rolled steel in Mexico. Ternium is currently developing high-value sheet products with the intent to displace imports. A. Lagarda of Serviacero Worthington, which operates three large service centres plus a pickling line in Mexico, thought there was plenty of service centre capacity in that country but not enough production of automotive components. N Vidaña of Nemak, a major producer of complex Al parts, expects Al use to grow especially in structural applications. A delegate asked whether the rapid industrial expansion had led to a shortage of skilled workers and what the average compensation was.
The answer was that thanks to ambitious training programmes launched by several Mexican provinces the supply of skilled labour seems to be adequate. Compensation was about $6/hr, roughly one third of the US level.
Micro-topics The next two sessions presented highly technical topics. D. Gallant of the National Research Council of Canada explained how laboratory simulation of corrosion could duplicate the corrosion damage found on samples of Al alloys mounted under trucks driven in traffi c for a lengthy period. The lab work provided crucial information for the development of alloys with improved corrosion resistance.
E. Petersen of AK Steel examined the tensile strength/elongation relationships and microstructures of dual-phase and press-hardened steels. In the same graphical
displays, he indicated the path that would lead to the development of third-generation AHSS grades.
An Al executive, J. Butler of Alcoa (which was recently split into two companies), announced a ‘breakthrough’ advance in Al production. It is embodied in Alcoa’s new micromill in Texas, which turns out sheet products of superior strength and deep-drawing properties while using far less energy and generating less CO2 than traditional mills. At present only a 60kt/yr pilot plant, it can be expanded to a commercial size of 450kt/yr. The metallurgical causes of the mill’s noteworthy product improvements were not revealed.
Passenger safetyC. Horvath of General Motors took the podium once more to describe efforts besides lightweighting to achieve the 2025 fuel economy targets, such as raising the effi ciency of powertrains and improving the aerodynamics of vehicles. He also summarised some of the issues that had come up in the discussion of lightweighting such as rules to ensure passenger safety in the vehicles. He noted, moreover, that the cost of vehicles is likely to rise steeply with a high degree of lightweighting. There is not only the higher cost of advanced materials but also the cost of new equipment to deal with the springback and stubborn waviness of advanced fl at-rolled steel as well as the cost of preparing new designs appropriate for the optimal use of Al, magnesium (Mg) and carbon fi bre.
The fi nal speaker was B. Kight of Meridian Lightweight Technologies. He pointed out the advantages of using Mg, especially its ease of being cast into highly complex shapes, which in some applications justifi es its high cost.
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DRI/HBI – exploding the mythsHalf a century of DRI/HBI electric arc furnace (EAF) use, coupled with low-cost American natural gas (NG) suggests a needed review of trends and controversial issues surrounding this alternative iron source (AIS). Aspects such as iron ore quality and operational influence; DRI stockpiling and transportation auto-ignition; optimum charge design, temperature and mechanism; compositional impact on EAF operation and performance; oxygen/carbon balance; and chemical energy need to be addressed. By Sara Hornby*, Jorge Madias** and Francisco Torre***
DRI/HBI production has grown “exponentially” since its inception in the seventies (Fig 1)[1]. Mexican, Trinidadian and Argentinean steel mills use captive DRI. Venezuela produces captive DRI and exported (merchant) HBI. Recent significant Venezuelan production curtailment has created a worldwide AIS shortage.
This dearth (and dependence) has renewed interest in USA DRI/HBI production where Natural Gas (NG) availability and price evolution now make low-cost AIS production possible.
Aspects of DRI/HBI production and use, such as iron ore quality, stockpiling, transportation, optimum charge design, method; temperature and chemistry; and its influence on EAF operation, energy balance and performance, are reviewed in this article.
NOTE: Unless otherwise stated, DRI is used for both DRI and HBI. Iron ore qualityMost gas-based DRI production uses pellets since DRI quality lump ore is rarely available. Quality iron ore production usually includes concentration steps which, while influencing gangue and phosphorus content, isn’t enough to compensate for decreasing DRI pellet feed quality arising from over-exploitation of resources during the first eight years of the last century[2].
Besides gangue and phosphorus, sulfur released during the pellet reduction process is important for modules using process gas in the reformer. During the pelletising operation, DRI gangue content (SiO2 and Al2O3) can increase (from the binder) as can sulphur (from the induration fuel). Many DRI pellet producers use organic binders[3]
(Peridur for example[4]) instead of bentonite to lower gangue content[7], improve metallurgical and chemical qualities, and thereby improve EAF operations and lower overall steel production costs.
To counteract lower ore quality, miners are changing concentration schemes [5,
6] and using new approaches to better define the relationship between mineralogy, pelletising and reduction behaviour [7].
Auto-combustion riskDespite the known auto-ignition risks involved in stockpiling and transporting DRI, more DRI than HBI has been shipped annually since 2006: in 2013, 8.56 MTe DRI vs. 5.65 MTe HBI (Venezuelan HBI shipped to the USA alone decreased from 1.8MTe to 0.5MTe). Generally, DRI ships shorter distances than HBI, although Acindar and Nucor import DRI
* Global Strategic Solutions Inc.,16317 Woolwine Road, Charlotte, NC 29278, USA. T: 704-488-7969 [email protected]** Jorge Madias, metallon, 432 9 de Julio St, San Nicolas, Buenos Aires, B2900HJG, Argentina. T: 011-54-336-442-1318 [email protected]
*** Francisco Torre, Formerly Acindar ArcelorMittal, 1930 Ayacucho St., Rosario, Santa Fe 2000, Argentina. T: 011-54-341-482-9302 [email protected]
Fig 2. Merchant DRI & HBI production sites [10]Fig 1. DRI/HBI world production 1970-2014 [1]
Lebedinsky GOK 2.3mt HBI
• Antara Steel 0.9mt HBI• Lion DRI 1.54mt DRI/HBI
• Welspun Maxsteel 0.9mt DRI/HBI• sponge iron producers using rotary
from Trinidad. Increased DRI shipments and DRI winter stockpiling to compensate for NG scarcity-induced downtime, caused a recent re-visitation of DRI auto-ignition [8, 9].
Fig 2 shows 2008 Venezuelan production of 6.9MTe[1]. In 2013 HBI production dropped to 2.8MTe. Changes to passivation/shipping regulations made in 2011 impacted DRI shipments.
ChargingOptimum charge design [12, 13]
Charge optimisation is very important considering that the EAF charge constitutes 73% to 89% of total liquid steel costs[12]. Historically, mills believed DRI/HBI carried an $8 to $30 premium due to penalties (higher kWh/Tels, tap-to-tap times (TTT), fluxes, slag FeO content, refractories and electrode wear, yield losses). As a result, DRI EAF use was restricted to producing high quality, low residual steels. Today it is known if EAF operators identify and understand the inherent and unique DRI properties and modify standard operating practices (SOPs) accordingly, educated use not only negates these disadvantages, but actually improves operations and operating costs (Table I).[13]
Fig 3 shows that even 50% DRI (composition: 93% Fe total, 93% Met., 1.8%C, 1.5% (CaO + MgO), 1.9% (SiO2 + Al2O3), 0.003%S) has reduced kWh/tcharged and TTT below that for 100% scrap. Note: today 93% Met. is low and basicity is now nominally 0.4 to 0.5 vs. the 0.79 cited, especially when operating 60% to 65% DRI.
To reduce operating costs, steel mills need to understand and quantify current operating efficiencies, optimise practices by charge mix and accurately define
% DRI kWh/ton TTT (mins)
All Scrap 421 61
25 375 52
30 377 53
35 380 54
40 393 55
45 399 57
50 408 59
Table I. %DRI Impact on operating parameters
800
700
L Fr
eeD
Draw
ing
Draw
ing
F w
ine
C qu
ality
Stru
ctur
al
Reba
r
600
DRI price = 420
DRI price = 330
DRI price = 150
Min
imum
liqu
id s
teel
cos
t (US
dls/
tls)
500
400
300
200
100
0
0.00 0.20 0.40Sum of residuals (Cu, Ni, Mo & Sn) wt %
Fig 3. Summary of DRI VIU results for 7 steel grades[12] Fig 4. Nominal charging practice by %DRI/HBI[12]
yield. Quantification of cost of variables associated with DRI use (continuous charging, safety and ease of handling (shipping, transfer, storage…), nitrogen removal capacity, carbon efficiency (in-situ), and practice changes needed will reveal the true value of DRI and metallics – enter the most important concept for optimising charges, the Value-in-Use (VIU) [12, 13, 14, 15].
Tenova demonstrated how DRI price, metallics’ VIU and end-product residuals’ constraints affected the use of DRI and the cost of liquid steel. A summary of results (three DRI prices, seven steel grades) is shown in Fig 3 above[12].
Charging methodologyAs DRI use increased worldwide, charging methods changed. Fig 4 shows nominal charging practices change with temperature and %DRI charged. Continuous feeding is usually employed above 25% to facilitate matching feeding rate to power, flux and chemical energy input to prevent, in part, ‘icebergs’ (‘ferrobergs’) and ensure slag control (foaming height, viscosity etc.).
For example, an 80MW average active power on a flat bath is equivalent to 1333kWh/min. If DRI consumes 500kWh/Te. to melt, the feed rate would be 2.7 Te/min.
or 33.75 kg/MW/min [13, 16].Bucket charging is generally used by steel
mills using less than 25% to 30% DRI/HBI, although it is preferable to continuously charge DRI. DRI/HBI in the bucket densifies charges, lowers liquid steel residuals and circumvents the cost of a continuous charging system.
HBI, charged on top of heavy scrap or bundles (Fig 5) for charge densification[13, 16] can improve melt refining (high FeO/low C). The rest of the bucket is loaded according to site-specific practice(s) [13, 16].
Fifth hole (roof) charging, preferred for DRI, is definitely more efficient for >30% charged. Captive DRI plants, mandated by poor quality or low availability scrap, use 60% to 100% DRI (Argentina, MENA) with DRI diverted to storage bins or warehouses when the EAF shop is down for maintenance or delays or in anticipation of DRI plant shut downs.
Continuous versus batch charging[12] negates roof swings (heat and time losses) significantly lowering energy needs and potential nitrogen pick-up (air ingress[15]).
Table II shows that continuously charged 33% DRI has the best results, saving 50.6 kWh/Techarged (Tec) and four minutes TTT compared to the two-bucket charge. Even continuously feeding 43% DRI saves 37.4kWh/Tec.
Cold versus hot charging: hot charging DRI reduces the power requirement by 20kWh to 30kWh/100oC. Fig 6 shows 27kWh/Tels
[12].Tenova reported[17] that only 375kWh/Tels is required to melt 100% DRI with 4%C charged at 600oC using 42Nm3 O2/Tels. Continuously charging 600°C DRI can lower energy by 16% to 20%. Table
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III summarises the data on the economic impact of 3.1% C HDRI in an EAF.
Metallon benchmarked HDRI charging using published data from 150 EAFs. Fig 7 represents the specific power consumption for EAFs charging between 20% and more than 80% of hot metal, pig iron, CDRI/CHBI or HDRI. Some HDRI EAFs match scrap-based EAF energy consumption. Specific consumptions shown are:
• PI between 325 and 400kWh/Te• CDRI 470 to 600kWh/Te• HDRI 425kWh/Te• Scrap 320 to 520 kWh/Te• HM (the best results) at 180 to 300kWh/Te
CarbonHigh FeOslag increases refractory erosion. Neutralisation requires the DRI to contain 0.215%C for every 1% Fe as FeO. So, 93% Met. DRI with 93% total iron theoretically requires 1.4%C for “neutralisation”. Any excess carbon can combust with oxygen and reduce electrical energy (9.09 kWh/kg of C at 100% efficiency). Excess carbon also promotes a faster, earlier, foamy slag reaction as CO and/or CO2 are evolved as FeODRI melts.
In the early 1990s most steelmakers requested 1.6%C to 1.8%C DRI because O2 tools and/or O2 supply were lacking for economical decarburisation (deC). (A longer deC time reduces productivity, costing more than inherent carbon energy/power savings). The advent of more efficient O2 tools and/or O2 supply, and quantification
Totan energy (kWh/Tels) 585.9 527 (-58.9) 419.1(-191.11)
Productivity (Te/hour) 163 177 (+14) 222 (+59)
Savings $/Te@$0.035/kWh 4.64 9.27
$/Te@$0.050/kWh 5.53 12.14
Table ll. Continuous vs batch charging of DRI[13, 14]
Table III. Economic* impact of 3.1%C HDRI in an EAF.[15] Economics assigned by author
Fig 7. Specific power con-sumption for HM, PI, CDRI and HDRI operations
of in-situ Carbon economics, has increased the %C requested today.
Today, optimal DRI %C is controversial and requires site-specific VIU analysis, considering local carbon costs, injected versus in-situ carbon efficiency (25% to 75% versus 95% as seen at AM Mexico[13,
15]), operational efficiency (deC potential, addition efficiency, TTT, DRI temperature) and productivity needs (DRI and EAF plant), to evaluate DRI carbon levels.
Tenova HyL promotes ≥4%C DRI while Midrex recently stated[18] that “the proper percentage exists as a spectrum of sorts,
not a fixed point” where “too much carbon is that which does not add any value to the production or further decreases the TTT of a steel heat”. Ergo consider VIU. HDRI captures latent heat, imparts greater energy to the melt but shortens available deC time and reduces the ability to handle higher %C.
AM Mexico modified SOPs when DRI carbon increased from 2.7% to 3.1%C DRI [13]. They negated carbon additions, used O2 earlier and fed DRI faster (improved, earlier foamy slag, better heat transfer and bath reactions achieved from in-situ carbon).
30
Elec
tricit
y sa
ving
Pow
er o
n-tim
e sa
ving
25
25
2
1.5
25
1
0
20
15
10
5
0100°C 1%C
kWh/tls
min/heat
1% Met
Fig 5. HBI bucket layering example[13, 16] Fig 6. Savings available from DRI variations[12
Light scrap
Medium scrap
HBI
Heavy scrap/bundles
Flames/coal
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Table III shows that $4.64/Tels is saved when 94.4%DRI is charged (at $0.035/kWh) not counting the 14 Te/hour productivity benefit[15]). This DRI C efficiency, coupled with its low residual properties, provides benefits such as: lower [N]steel and [H]steel (CO purging), energy use, TTT, refractory wear, liquid steel cost (Table III, Fig 6), and increased yield and productivity[12, 15,
17]. Tighter chemistry control allows tighter process control and greater yield and quality downstream[12].
Metallisation Table IV shows the benefits derived from a 1% increase in metallisation at Acindar [13, 19], Ternium Guerrero[4] and industry in general. Figs 8a and 8b represent Acindar’s results. Savings of 10 to 25 kWh, 0.425 kg refractories and 0.0375 kg electrodes/Tels with between 0.3% and 2% increase in yield were realised. Increasing metallisation from 91% to 95% reduced power by 40 kWh/Te and increased yield by 1.5% per 1% increase in metallisation. Similar results were achieved at Qatar Steel[21].
GangueHigh oxide has detrimental process effects. 10% DRI charge penalties are 15 kWh/Tels, 0.19 kgelectrode/Tels, 2.5 mins. TTT, more slag former (greater slag volume/disposal cost) and l0.4% yield and productivity loss. A 1% decrease in metallisation increases power needs by 8kWh/Te to 16kWh/Te. Contrarily, 10% PI (4%C, low oxide) lowers power by 27.1 kWh/Tels.
A 1% increase in acid gangue increases basic fluxes (MgO, CaO) to satisfy the V4 EAF slag ratio. CaO’s 2% increase /1% SiO2 is exponential when SiO2 >2%, increasing power requirements 20 kWh/Te, as well as slag volume and disposal costs. The acid gangue components, SiO2 and Al2O3, have a more costly impact on production costs
750
Ener
gy c
onsu
mpt
ion
[kW
h/To
nne]
725
700
675
660
625
600
575
550
525
500
90.590 90.5
93
92
91
90
89
88
87
86
8591 9191.5 91.592 9292.5 92.593 93
Metallisation [%] Metallisation [%]
DRI Y
ield
(%)
93.5 93.594 9494.5 94.595 9595.5 95.596 96
y= 7.6107x2 -1468.5x + 70418
y= -0.2997x2 + 57.203x - 2637.4
Fig 8a. kWh/Te vs. metallisation[13, 19] Fig 8b. DRI Yield vs. metallisation at Acindar[13]
Benefits Category General Acindar13 Ternium Guerrero4
KWh/T liquid steel 10 to 25 25 12
Refractory savings (kg or $/Tonne liquid steel) 0.425 $0.70
Cost Reduction (VIU) ($/Tonne liquid steel) $0.68 to $2.96 $6.00 to $8.09 $5.00
Increase in Metallisation (%) 92 to 93 93.5 to 94.5
Table IV. Benefits of a 1% Increase in Metalsation of DRI/HBI
than these basic flux components due to their higher flux and yield loss cost [12, 13,
14, 15]. FeO is required to help flux/dissolve the lime and/or dolomitic lime, promoting an early liquid slag. 67% of the FeO in DRI is reduced by C resulting in CO gas which promotes an earlier, better, foamy slag.
Chemical energyThe main parameters impacting EAF energy use are composition of raw materials (chemistry, metallisation, energy content), operating practices (power profiles, carbon additions, foamy slag and melting practices) and furnace design (heel, O2 use and tools, off gas (OG) and charging systems, AC/DC). Informed and intelligent DRI use can significantly benefit the operating results[15,
19, 20, 21, 22]. Chemical energy, from combustion
of C (contained, charged, injected), O2, NG (“fuel”) and “burning” bath elements (iron (Fe), silicon (Si), aluminum (Al), etc.) is today about 35% of total energy and rising (more than 50% has been seen). This should be maximized if the economics of so doing are beneficial (VIU).
Greater chemical energy infers increased volume and energy loss to the OG System (OGS) due to partial combustion (nominally 17% to 22% in standard EAFs, 10% in Consteel® and shaft furnaces and 7% in finger shaft furnaces). The OGS must be large enough and/or fan
operations modified; combustion optimised (maximised) and energy captured/retained through understanding the materials’ VIU, partial combustion source, chemical and electrical energy balance [14, 15], and OG analysis (temperature and composition).
Hot charging reduces energy needs significantly. Charging HDRI negates the gangue impact[12].HM reduces energy the most but deC time can become an issue (productivity loss).
When injection systems in two DRI-based EAFs were revamped, Krakatau Steel cited 155kWh/Tels, 0.1kgelectrodes/Tels and productivity gains, lance pipe elimination with increased NG consumption (+3Nm3/Tels) and refractory wear[22].
Conclusions – DRI/HBI is here to stay
• Declining iron ore quality is being improved from the mines through to pellet binders.
• DRI shipped tonnage today exceeds that of HBI
• The greater carbon (chemical) energy efficiency of DRI’s in-situ carbon can significantly alter the VIU of DRI.
• Site-specific VIU should consider ability to handle high %C (deC tools, OGS), the use of low oxide load (gangue), DRI/HBI (organic binders) and (long-term) charge pre-heating to reduce operating costs.
• As SOPs are altered to accommodate DRI use, the benefits and VIU of DRI will be
DRI.indd 4 2/4/16 9:36 AM
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maximised and detriment to EAF operations minimised.• EAF optimisation will be site-specific, balancing DRI and metallics’ VIU
with SOPs.• The VIU of DRI burdens changes significantly with price. • Cheap North American shale gas will drive new DRI plant investments
and guarantee long-term quality metallics supply.• DRI use will grow as the ‘price will be right’!• Educated use of DRI (VIU, DRI specific SOPs) will allow mills to produce
low-cost liquid steel as effectively as scrap charges. t
References
1. “2013 World Direct Reduction Statistics”, Direct from Midrex Second Quarter 2014.
2. Grazziuti, A., private communication, July 2014.
3. Valadares de Andrade Resende, F. et al; “Performance Analysis of Organic Binder Compared to the Sodium Bentonite and the
Over-activated Sodium Bentonite in the Production of Direct Reduction Pellets”. 43rd Raw Materials and Iron Ore Ironmaking Seminar,
September 2014, Brazil, pp. 1009-1013 (in Portuguese).
4. Hornby, S.; “EAF Optimization”, 2007 Intertech Conference on Scrap Substitutes, October 2007.
5. Pereira Lima, N. et al; “Process Routes for the Exploitation of Poor Itabirites of the Iron Quadrangle”. 41st Raw Materials and Iron
Ore Ironmaking Seminar, September 2011, Brazil, pp. 587-594 (in Portuguese).
6. Uliana, A. et al; “Characterization of Compact Itabirites of Alegria Mine – SAMARCO Mineração (part 1)”. 42nd Raw Materials and
Iron Ore Ironmaking Seminar, September 2012, Brazil, pp. 1551-1562 (in Portuguese).
7. de Pinho Rocha, J.M. et al; “Detailed Investigation on Goethites Present in Altered Amphibolitic Itabirites (MG-Brazil)”. 42nd Raw
Materials and Iron Ore Ironmaking Seminar, September 2012, Brazil, pp. 1754-1764 (in Portuguese).
8. Ajargo, F.M. et al; “Methods and Experiences in Open Air DRI Storage in Tenaris-Siderca”. 7th IAS Ironmaking Conference, November
2009, Argentina, pp. 64-71 (in Spanish).
9. Grazziutti, A.G. et al ; “Development of Laboratory Tests to Evaluate the Reactivity in Sponge Iron”. 6th International Congress on
the Science and Technology of Ironmaking – ICSTI, October 2012, Brazil, pp. 932-942.
10. Hassan, A., “Ore-Based Metallics 101”, International Iron Metallics Association (IIMA) Seminar, October 28th 2012, USA.
11. Noel. N. et al “Shipping of DRI – The Nu-Iron Experience”. AISTech 2014 Proceedings, pp. 823-829
12. Hornby, S; “Mini-Mill Burdening for Maximum Efficiency and Yield?”, AISTech 2014 Proceedings pp. 1027-1038 and Re-published in
Iron and Steel Technology, January 2015, pp. 50 – 62
13. Midrex Melt Seminar, May 2000, Tuscaloosa, AL, USA.
14. HBI and DRI Melting Seminar, May 2002, Singapore, Co-hosted by Midrex and BHP Australia.
15. Hornby-Anderson, S., “The Educated Use of DRI/HBI Improves EAF Energy Efficiency and Yield and Downstream Operating Results”,
European Electric Steelmaking Congress, Italy, May 2002.
16. IIMA Seminar in conjunction with the AIST Scrap Supplements & Alternative Ironmaking VI Conference October 2012, USA
17. Memoli, F. et al; “The Use of DRI in a Consteel® EAF Process”, Iron and Steel Technology, January 2015, pp.72 – 80.
18. Direct From Midrex First Quarter 2014.
19. Torre, F. et al; “Results of CoJet® technology (gas and coal fines injection system) in ACINDAR S.A., with continuous DRI charging”,
15th IAS Steelmaking Conference, November 2005, pp. 24-32 (in Spanish)
20. Al Saif, M.M. et al; “Improvements in graphite electrode consumption in HADEED long products”, 8th European Electric Steelmaking
Conference, 2005, pp. 173-182.
21. D’Souza, J. et al. “Use of High Percentage Quality DRI in EAF and Its Benefit in Cost Reduction”. AISTech 2011 Proceedings – Volume
I, pp. 955-972.
22. Stagnoli, P.; “Smart injection tools in DRI-based EAF steelmaking at Krakatau Steel”. Steel Times International – November/December
2011 pp. 13-16.
23. S. Hornby et al, Myths and Realities of Charging DRI/HBI in Electric Arc Furnaces, AISTech 2015, PR-368-204.5664
Myth – DRI significantly increases steel costs
Reality – Not if mills optimise operations
Myth – Iron ore quality is constant
Reality – It is diminishing
Myth – DRI cannot be shipped distances
Reality – More DRI than HBI is shipped today
Myth – DRI use increases liquid steel cost
Reality – Not if mills use VIU to define charge mixes
Myth – DRI is detrimental to EAF operations
Reality – Not if SOPs are optimised
Myth – DRI does not add chemical energy to the EAF
Reality – DRI’s in-situ C is a more efficient energy source
Myth – DRI/HBI is used only where scrap quality is bad, availability of low or high quality steel predicates.
Reality – Metallics’ VIU, optimisation of charges and SOPs, lower cost DRI/HBI production, promote increased use.
HBI is here to stay!
For 40 years, Köppern briquetting machines have played a key role throughout the world in the production of HBI for DRI processes.
And HBI is still in demand, as demonstrated by the upcoming installation of new HBI plants equipped with Köppern roller presses, at LEBGOK (Russia) and Voestalpine (USA).
» State of the art technology » Experts in process technology » High plant availability » Long-lasting equipment
Köppern – Quality made in Germany.
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DRI/HBI – exploding the myths[23]
DRI.indd 5 2/4/16 9:36 AM
For Sale By Negotiation
Contact Charles Moses F.R.I.C.S for more information email: [email protected] or telephone: +44(0)7831 854971
A Highly Versatile 600,000 tpy Top Quality Wire
Rod Rolling Mill
For Sale as a Result of Reinvestment
Bar Inspection & Conditioning Line - For High
Specification Round Bar 18-102mm Diameter
Instructed by a leading European Steel Producer
Anticipated Release date Feb 2017
• This Mill is fully operational it can be seen working • Various European Manufacturers including SMS, Schloemann-Siemag-Morgan, CTI, ABB and others
• Originally installed in 1979, but has benefited from major upgrades and refurbishment in 1988, 2000, 2004-2008 and 2010-2012
• Utilising 130mm x 130mm x 12m (1.5t) Billet producing Wire Rod (5.0-23mm) and Garret (Bar in coil) from 24-32mm
• This Mill has a reputation for producing top quality product from a range of steel grades including Spring Steel, Cold Heading Steel, High Carbon Steels and Welding Materials
• The sale includes a huge range of tooling and spares together with a comprehensive range of drawings and technical documents
Location: Austria
Available Immediately
• Year of manufacture – 2007• VASCAS Bar Straightener• Shear• Bar Chamfering Section• PROCOME Bar Defect Detection System• MECA System Cantilever Bar StorageSystem
• The sale includes a huge range of spares together with a comprehensive range of drawings and technical documents
Guide Price €1.5m
Location: Barcelona, Spain
AM6025 adverts_Steel Times International 18/01/2016 16:43 Page 1
HANDLING 31
www.steeltimesint.com January/February 2016
THE Wire Rod Mill (WRM) of Bhilai Steel Plant (BSP) is a continuous high capacity mill comprising two furnace charging grates, a common pusher type reheat furnace, a common mill train of 15 roughing and intermediate stands and four finishing strands and a coil handling area. The operations and controls are distributed throughout several pulpits and machine halls.
In the furnace charging area, there are two charging grates (Fig. 1) onto which the billets are placed by cranes and then pushed onto a roller table to be carried to the furnace. Some of the billets may either be defective or over-length. These should be visually identified by the operator and removed from the roller table by a billet rejecter mechanism (Fig. 2). Each charging grate has one billet ejector.
Refractory damageIn the absence of any on-line billet measuring system, oversized billets, greater
than 11,800mm long, are frequently not identified manually and are fed into the furnace where they become stuck when pushed through the furnace, which results in furnace delay, damage to refractories and hampers production.
In view of this, a non-contact billet length measuring system comprising laser sensors, a Programmable Logic Controller (PLC) and display has been conceived, designed and implemented to measure the length of billets at the charging grates and so identify billets that are too long.
The lengths of all the billets are displayed to the operators at the charging grate’s control pulpit (CP). A Binary Coded Decimal (BCD) unit is provided along with a warning light to alert operators of billets that are too long.
The system has been commissioned and is running satisfactorily enabling online determination of billet length to an accuracy of ±4mm. It provides timely identification of billets that are too long for
the furnace and has completely eliminated these being charged to the furnace. This has reduced downtime in the furnace area by 10% and so increased productivity.
Design and implementation The objective was to reduce controllable furnace downtime by providing an online billet length determination and identification system to warn operators of over-length billets. The approach used was to:
• Implement a comprehensive system for billet length measuring and identification of long billets at the charging grates and set a visual alarm/annunciation system at the control pulpit.
• Provide instantaneous display of all billet lengths on both charging grates to the control pulpit operator with visual alarm/annunciation in the case of over- length billets.
• Install a PLC panel, non-contact laser sensors, BCD displays and visual alarm.
Non-contact billet length measuring
1. Research & Development Centre for Iron & Steel (RDCIS), SAIL, Ranchi-834002, India2. Bhilai Steel Plant (BSP), SAIL, Bhilai – 490001, India e-mail: [email protected]
To prevent over-length billets being charged to the reheat furnace and causing jams, a laser distance measuring system has been installed at the charging grate to warn operators of oversize billets. Furnace availability has improved 10% since its implementation. By V Kumar1, A Sharan1, U Rani1,A Kumari2, P Kumar2, S Kumar1, B N Ghosh1, M K Gupta2 & B K Prasad1
Principle of operationThe configuration of the PLC and other equipment is summarised in Fig 3. The system is built around one PLC, two laser- operated distance measuring devices at each grate and, in the control pulpit, a BCD display and visual alarm LED light as annunciator, for each grate. The sensors are mounted with water cooling and with air purging, to keep the lenses clean. The two laser sensors are positioned on opposite sides of a charging grate so as to view each other across the grate at a set distance (L). As a billet, aligned with the laser beam, passes between them it interrupts the beam and each sensor instead measures the distance to the respective ends of the billet (L1 & L2). The sensors each give these distances as an analogue signal which arrives at an analogue module connected to the PLC. The length of the billet (BL) is simply calculated as:
BL = L – (L1 + L2). All calculations are performed by the PLC
using an in-house developed program. The result is shown by the BCD display in the
Fig 3. Configuration of on-line measuring of billet length
PLC room 200 Metres
200 Metres150 Metres
100 Metres100
Met
res
Power cable
Pow
er c
able
Signal cable Charging grate #2
Charging grate #2 Pulpit
Laser sensor with cooling jacket 4 digit BCD display for billet length
PLC panel Billet (105mmx105mmx11800mm)Annunciation LED lamp for longer billets
Charging grate #1 Pulpit
Charging grate #1
200 Metres
Display of billet length Visual annunciation of longer billet
Fig 4. Operators’ display in pulpit
to install the PLC panel display in the pulpit without disrupting normal operations; and lay power and signal cables and necessary interfacing to the laser sensor and BDC.Cables were laid through a conduit following various routes to the control pulpit. A water line was extended to each sensor for cooling purposes as well as extending an air line to each sensor for lens purging. Four mounting structures were constructed to mount the laser sensors at the specified distance from the ends of a billet, two for each charging grate. A base plate was also fabricated to mount the PLC. The BCDs were installed in the control pulpit to display the length of each billet.
TrialsExtensive trials were carried out during scheduled shut down periods as well as when the mill was operating to test the on-line conditions during rolling. All ran trouble-free and safely. After fine-tuning the PLC software the system was running as planned.
Results With the installation of the billet measuring system, information regarding actual billet length is instantaneously available at the pulpit for further decision.
The PLC calculates the actual billet length as BL = L- (L1 + L2) (Fig. 5). The result is displayed at the BCD in the control pulpit (Fig. 4).
The PLC also enables easy and fast troubleshooting in case of system breakdown. The various features incorporated for measuring, monitoring and supervising have enabled a reduction in controllable mill delays caused by furnace jams.
The installation is designed such that future expansion and modification can easily be implemented. It has been running continuously since commissioned and is in use for effective operation and maintenance
Fig 5. Method of calculating billet length
L1 (mm)
Billet
Billet length (mm) = L - (L1 + L2)
Lasersensor
L2 (mm)
Lasersensor
control pulpit; which is connected to the PLC via a digital output module.
In the case of the PLC sensing a billet longer than the pre-defined maximum length it transmits the digital output to a warning LED light installed in the control pulpit. The online billet length display and excess billet length warning light displayed in the pulpit is shown in Fig 4.
Erection and commissioningErection and commissioning involved meticulous planning and execution, using existing shop shutdown periods in order
management. It has enabled online measurement of billet length to an accuracy of ± 4mm, timely identifi cation of over-length billets and total elimination of such billets being charged to the furnace. As a consequence, downtime in the furnace area has fallen 10% and so increased productivity.
The installation has demonstrated that modern state-of-art automation can greatly improve accuracy, reliability and repeatability. The equipment has good reliability, but should a fault occur this is much easier to diagnose and rectify than in previous systems. Also, modifi cations in the control algorithm are easier to carry out. The laser distance sensors also exhibit good connectivity and compatibility with the PLC software enabling ease of confi guration, status checking and rectifi cation of any faults.
The success demonstrates that similar billet length measuring and identifi cation of over-length billets can be effectively implemented in other rolling mills for materials handling where length or distance measuring is required for smooth operations and control.
AcknowledgementsThe task force members are grateful to the management of RDCIS & BSP for
providing this opportunity and continuous support for executing the project
successfully. Special acknowledgments are due to all the people of WRM, BSP for
supporting the project from concept to commissioning and for maintaining quality
and timely execution of the project. The taskforce sincerely thanks all those who
have directly or indirectly supported the project.
Bibliography1 ‘Automated monitoring and diagnostics of metallurgical plants and rolling mills’,
by Jorg Deckers, Olaf N Jepson, Siegfried Latzel, MPT International 5/2002:-
This provides an insight into the state of automation and monitoring systems
prevailing in modern steel processing units and helped in formulating the project
scope and design features.
2 ‘Laser ranging: a critical review of usual techniques for distance measurement’
State-of-the-art direct and indirect firing, controlledatmosphere heating systems,covering a wide range of industrial furnaceapplications from reheatingto heat treatment processesfor steel, aluminum andcopper production.
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1914 / 2014
DANIELI CENTURY
Four significant references out of total 238
VALLOUREC & MANNESMANNProjects including reheating furnaces and four heat treating furnaceswith direct and indirect firing systemsby means of high-waste gasesrecirculation fans, completed with in-house developed quenching system for pipes O.D. ranging from 4 to 16”.
RIVA ACCIAI ITALY350-tph walking beam furnace for 270-mm thick slabs running cokeoven or natural gas equipped with MABflameless proprie tary patented burners.Ultra-low NOx emissions down to 65 mg/Nm3, low gas consumption below270 kcal/kg.
ACCIAIERIA ARVEDI ITALYLatest generation vertical furnacefor DP and TRIP steel strip equippedwith proprietary premix burners, self-recuperative burners in 2P Inconelradiant tubes and rapid cooling incontrolled atmosphere up to 110 °C/s.Gas consumption 16-20 Nm3/t forcommercial steel grades production.
OMK RUSSIATwo 230-m-long, roller hearthtunnel furnaces for twin continuos casting lines, with slab handling shuttles. 570 t/h productivity for 80-mm thick, 1570 mm wide slabs in low carbon and HSLA steels.
Pagine 2013 A3 esecutivi 2013_08_08_qxd8_A3 esecutivi 14/01/14 10.12 Pagina 25
State-of-the-art direct and indirect firing, controlledatmosphere heating systems,covering a wide range of industrial furnaceapplications from reheatingto heat treatment processesfor steel, aluminum andcopper production.
DANIELI CENTROCOMBUSTIONULTRA-LOW NOXHEATING SYSTEMSFOR AN EFFICIENT AND SUSTAINABLESTEEL INDUSTRY
DANIELI THE RELIABLE INNOVATIVE PARTNER TO BE FRONT RUNNERS
1914 / 2014
DANIELI CENTURY
Four significant references out of total 238
VALLOUREC & MANNESMANNProjects including reheating furnaces and four heat treating furnaceswith direct and indirect firing systemsby means of high-waste gasesrecirculation fans, completed with in-house developed quenching system for pipes O.D. ranging from 4 to 16”.
RIVA ACCIAI ITALY350-tph walking beam furnace for 270-mm thick slabs running cokeoven or natural gas equipped with MABflameless proprie tary patented burners.Ultra-low NOx emissions down to 65 mg/Nm3, low gas consumption below270 kcal/kg.
ACCIAIERIA ARVEDI ITALYLatest generation vertical furnacefor DP and TRIP steel strip equippedwith proprietary premix burners, self-recuperative burners in 2P Inconelradiant tubes and rapid cooling incontrolled atmosphere up to 110 °C/s.Gas consumption 16-20 Nm3/t forcommercial steel grades production.
OMK RUSSIATwo 230-m-long, roller hearthtunnel furnaces for twin continuos casting lines, with slab handling shuttles. 570 t/h productivity for 80-mm thick, 1570 mm wide slabs in low carbon and HSLA steels.
Pagine 2013 A3 esecutivi 2013_08_08_qxd8_A3 esecutivi 14/01/14 10.12 Pagina 25
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and alloying using a dynamic and flexible optimisation model based on the current market price of the ferro-alloy without affecting the end quality of the steel.
In-house modelA model taking into account the prevailing purchase price of the ferro-alloys has been developed in-house. The ‘front end’ providing the graphical user interface, through which the operator will interact with the software, is designed in Java while all background calculations are performed in Microsoft Excel. The program is a decision-making tool for shop floor managers in the steel melting shop to be used to calculate optimised additions of various ferro-alloys such that the cost of addition is minimised while the chemistry of the steel grade is achieved without affecting the final quality of the product.A manager can log into the system either
in ‘administrator’ or ‘operator’ mode (Fig 1). For the ‘operator’ mode, the inputs are the tap chemistry and heat weight, the type of de-oxidation practice, the target grade of steel and the combinations of alloys preferred (Fig 2). Using the recovery factor, chemical composition of the alloys and the price of different alloys, which has been pre-defined, the model calculates an optimised routine and suggests a combination of de-oxidiser and ferro-alloys to be added which will achieve the target grade chemistry at lowest cost (Figs 3 & 4).Alternatively, if the user logs in as ‘administrator’, this provides the ability to add new grades of steel, edit the target chemistry of existing grades, edit the composition of the ferro-alloys, change the price of the ferro-alloys as well as change the recovery factors for different de-oxidation practice. This data is saved in the Excel worksheet which then uses the
TESTING & ANALYSIS 37
www.steeltimesint.com January/February 2016
Ferro-alloy optimisation explained
An optimisation model to determine the lowest cost of ferro-alloy additions has been developed in-house by SAIL R&D. In-plant trials have resulted in an average 5.33% reduction in costs by replacing HCFeMn with lower cost SiMn and reducing the use of FeSi, without detriment to the chemistry of the steel grades tested. By K K Keshari, R K Singh, S Kumar, S Roy, S Ghosh & R Datta*
* The authors are with the Research and Development Centre for Iron & Steel, Steel Authority of India Ltd, Ranchie-mail [email protected]
THE ferro-alloy market is very competitive, open and dynamic, which results in frequent changes in prices on the international market. Steelmaking requires the addition of ferro-alloys depending on the grade-specific requirement to meet the stringent quality demands of the customer.To be more competitive in the market and produce steel at lower cost, using the exact quantity of ferro-alloy is required. The use of a process model based on current market price is a must to maintain market share. The stiff rise in price of high carbon ferro-manganese (HCFeMn) and ferro-silicon (FeSi) in recent years has increased the input cost of ferro-alloys in steel production. But the conservative nature of steelmakers coupled with an absence of decision-making tools makes any change in de-oxidation and alloying practice difficult in day-to-day operations. The higher input cost of ferro-alloy for steel production can be tackled, to some extent, by selection of grade-specific de-oxidation and alloying practice using lower cost de-oxidisers and ferro-alloys.
Additions of ferro-alloys account for 3.0 – 6.0% of the total cost of saleable steel, the range depending on the product mix of the steel plant. Lowering production costs can be tackled in two ways:
• Process improvement to achieve higher recovery of the ferro-alloy by using the latest technology, such as modelling of blowing practice, control of slag oxygen potential, detection and control of carry over slag to the ladle and so on.
• Judicious selection of the right quality and quantity of ferro-alloy for de-oxidation
Developed by RDCIS, SAIL, Ranchi
CLOSE
LOGIN ID
LOGIN
PASSWORD
admin
LOGIN RESET
HOME
CHANGE ADMINISTRATOR PASSWORD
CHANGE OPERATOR PASSWORD
• • • • •
Fig 1 Logging in window
testing &Analysis ferro.indd 1 1/27/16 12:03 PM
TESTING & ANALYSIS38
www.steeltimesint.com January/February 2016
optimisation routine to calculate the lowest cost ferro-alloy addition. The quantity to be added, total cost of addition and temperature drop following the addition is displayed on the screen.
Development of model After completion of the oxygen blow in the BOF converter, steel is tapped into a pre-heated ladle along with flux and de-oxidiser to maintain a slag basicity suitable for the ladle lining and to remove oxygen dissolved in the steel. De-oxidiser and additions of ferro-alloys are made to the ladle during tapping to achieve the target grade chemistry. Any necessary trimming additions that take place in the secondary refining
Table 2 Ferro-alloy consumption and input cost for earlier practice
Hardware requirement Software requirement
> Minimum 512 Mb RAM. > Operating System- windows 98, windows 2000,
> 40 Gb Hard disk. Windows XP, Windows Vista, Windows 7.
> Colour Monitor.
> Java Runtime Environment (JRE 5.0).
> Microsoft Excel 2003 or Microsoft Excel 2007.
Table 1 Hardware and software requirements to run optimisation model
chemical specification to reduce cost may lead to off-grade chemistry.
To determine the optimised additions, the heat weight that is being tapped from the converter along with the bath oxygen level is entered as input. Next the target grade, the type of de-oxidation practice being followed and the different ferro-alloys available in the bunkers is selected. Hardware and software requirements are presented in Table 1.
Software developers may install purchased software or develop new, custom designed programs. Programmers are responsible for documenting the program, providing an explanation of how and why certain procedures are coded in specific ways. Documentation is essential to test the program and for maintenance once the application has been installed. Evaluation of development in accordance with such yardsticks as overall development time and effort, conformance to budgets and standards and other project management criteria is necessary.
On-going maintenance is also required to eliminate errors during the program’s working life and to tune the system to any variations in its working environment. Small deficiencies are often found when a system is brought into operation and changes are made to remove them. Operators must plan for resource availability to carry out maintenance, which is essential to ensure the new system meets any modification in standards.
Validation and industrial trialsTrials were carried out at the Durgapur Steel Plant (DSP) of the Steel Authority of India Ltd (SAIL) keeping in mind the prime objective of reducing ferro-alloy input cost. The Steel Melting Shop (SMS) at Durgapur produces a variety of steel grades using the
Fig 2 Initial home window to define alloy
Fig 3 Cost of ferro alloys
units are carried out very carefully to avoid off-grade chemistry as well as adding extra costs. Targeting the lower range of the
testing &Analysis ferro.indd 2 1/27/16 12:03 PM
TESTING & ANALYSIS 39
www.steeltimesint.com January/February 2016
BOF-LF/VAD – Bloom/Billet Caster route. DSP produces mostly Si-killed and semi-killed steels using high carbon ferro-manganese (HCFeMn), ferro-silicon (FeSi) and silico-manganese (SiMn). As well as for de-oxidation, ferro-alloys are also used for micro alloying and alloying of special steels to impart distinctive properties to the steel. Stiff rises in the price of HCFeMn and FeSi, increase the input cost of steel production. Re-designing the de-oxidation and alloying practice based on the outcome of the in-house-developed ferro-alloy optimisation model helped to significantly reduce ferro-alloy input cost. The model was validated in DSP and could be fine-tuned to other steelmaking routes such as electric arc or induction furnace melting with continuous or ingot casting.
Plant trails were carried out for the four major targeted steel grades made at Durgapur, namely SAIL Tower Gr-6, Fe-500D, C-20, and C-15 using the ferro-alloy additions presented by the optimisation model. Price fluctuation of ferro-alloys during the trial were taken into account and adjustments made to the process chart. All the heats made during the trial met the target chemistry and over 1000 were made without problems.
The model calculates the quantity of de-oxidiser and ferro-alloy to be added during tapping from the BOF into the ladle. After tapping, ladle metal samples were taken and accordingly trimming additions made at the ladle furnace. Metal samples were collected and analysed.
The results indicated that a 100% replacement of costlier HCFeMn by cheaper SiMn and a substantial reduction (17 - 48%) in FeSi additions (depending on steel grade) are possible. The modified de-oxidation and alloying practice did not call for any additional amount of ferro-alloys, but rather higher consumption of SiMn, for all four major grades of steels considered. The target chemistry was achieved for each grade of steel in every heat.
The average input cost of the ferro alloys for each grade was calculated for comparison and to determine the effectiveness of model-based addition practice. Cost data indicates a lower cost for all the grades. The cost benefit was calculated based on the prevailing market price of ferro-alloys during the validation period. A comparison of cost data for normal and modified practice is shown in Tables 2 & 3. These show a benefit of Rs55/t for SAIL Tower Gr 6 and Fe500D, Rs82/t for C-20 and Rs73/t for C-15
Assuming equal quantities of each steel grade is made, the average saving is Rs66/t, which is an average reduction in ferro-alloy input cost of 5.33%.
The model can be fine-tuned for any steel plant including other steelmaking routes. t
Fig 4 Final window showing optimised inputs
testing &Analysis ferro.indd 3 1/27/16 12:03 PM
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TESTING & ANALYSIS 41
www.steeltimesint.com January/February 2016
Consistent strip quality
* Michel DUBOIS and José Callegari are both process experts, CMI INDUSTRY Metals, Seraing, Belgium.
CMI has engineered and commissioned automotive galvanising lines all over the world. The company’s strip processing lines, feature the very latest process technologies, including: Multi-stage cleaning section, vertical furnace (including L-Top math model and jet cooling system with energy recovery), zinc pot section and air-knife system, After-Pot-Cooling – the APC Blowstab cooling system – in-line skin pass mill and tension leveller, chemical and organic roll-coat post treatment, side trimmer and exit shear. These features are at the heart of CMI’s Operation, Process Expert System (OPExS).
OPExS Steelmakers’ quality control systems are often set up to simply monitor key variables, affecting the production process, in real time. Any deviation from the acceptable range will be indicative of quality issues, but the solution to solve them is not always at hand. OPExS fills the gap between available data and the action needed to be taken by the operator – based on process and coil data analysis – to determine process and quality conditions and provide operational advice and guidance when selecting suitable operational parameters and production processes.
The system provides operators with the necessary customised assistance to make quality decisions. Figs 1 and 2 illustrate the heating furnace and the zinc pot, which are closely monitored by OPExS.
The proprietary software provides automatic coil grading (Fig. 3). The line model functions as a control chart that
When faced with multiple challenges, choosing the right equipment or process can often prove complicated. To see a project through to a successful conclusion, steel producers need to find the optimum balance between the technical performance of their products and minimising costs. Then, to make the right decision, they need to be able to rely upon sound and versatile technical and process skills. By Michel Dubois and José Callegari*
with set criteria for a specific production run during which it has been produced and thus related to a defined customer, still meets the criteria of another customer. Automatic coil grading, provided through the software, considerably speeds up coil validation and reduces the number of rejected coils – and the cost.
The core attribute of the software is its expert know-how, which is linked on-line to the process control system. Data relating to quality coming from the line are recorded, stored, and analysed, allowing for easy and visual best practice sharing, improved equipment utilisation and – eventually – scrap reduction and increased yield, as well as increasing the pace of, say, automotive certification and the implementation of new steel grades.
The display on the left hand side is an overall view of the grading of all coils produced, using specific markers indicating whether or not line status has met the required quality standard. A traffic light report helps the operator to visually identify anomalies by produced coil and process section (green = in line/ orange = partially out of line/ red = out of line).
Data mapped under the line model details the different process parameters within each of the line’s process sections. This helps identify where the data falls foul of defined criteria settings and where the anomaly occurred. Criteria settings comprise either fixed criteria or tolerance ranges.
The expert systemWhile operational indicators are provided via the software, an expert system defines
Fig 1. (above) Furnace process section
Fig 2. (below) Zinc pot section
monitors process stability and signals when the charted parameters show unpredicted process drift. It condenses all process data onto one wide screen thus speeding up identification and intervention. This helps the steelmaker to determine whether a produced coil, even though not compliant
Testing & Analysis dubois 2.indd 1 1/25/16 11:44 AM
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www.steeltimesint.com January/February 2016
what action to take, as well as where and when to take it. Such advice is transmitted via a ‘pop-up window’ that opens when the operator clicks on the process parameter that is out of range. All data and instructive guidance is displayed in the form of either indication of corrective action to be taken, additional checks to be conducted, or a library of reference documents or similar events for comparison.
Individual pop-up windows are divided into three tabs: expert advice, data and actions. Expert advice indicates what the operator should do, helping him or her to understand underlying process behaviours, as well as prioritise and select the actions needed to restore the nominal quality of the line. It can be submitted in the form of a list of actions by equipment and/or a flow chart indicating the methodology to follow for trouble-shooting and problem-solving (Fig. 4). It can also include supporting
documents, such as 3D drawings, to help the operator visualise the specific equipment on which the problem has been detected, such as photographs related to quality defects, or other instructive documents, like standard operating procedures.
Under the data tab detailed, recorded data related to the out-of-line parameter is given, and under the action tab the operator formally acknowledges which actions have been taken. The software provides a weekly analysis of suggested actions versus actions taken, and allows for an operator’s input that can or is requested to be entered, and can be either observations or recommendations.
As the pop-up window and related advice are available within minutes of the coil being produced, it guides operators most effectively in day-to-day operations. The software enables a direct link to processing
data from the line and can be accessed online.
Statistical process controlAnother important advantage that the system provides is the correlation of recurrent defaults that impact quality; this is vital to anticipate problems. Orange traffic lights highlight sections that are not fully in line with line parameters over a period of time and are a good indicator of where to take corrective action, thereby preventing anomalies. OPExS also functions as an on-line statistical process control (SPC) system, which, via continuous monitoring and process analysis, provides an important input for lean ‘just-in-time’ maintenance planning.
Recorded process parameters can be displayed by process section and are synchronised per running metre of coil, which helps define exactly when a non-
Fig 3. Model screen display example
Fig 4. Trouble shooting and problem solving
Testing & Analysis dubois 2.indd 2 1/25/16 11:44 AM
Innovative technologiesfor the metals industry
Cold rol l ing § Str ip processing § Chemical processes Thermal processes § Mechanical equipment
conformity occurs, and thus reduces the amount of strip to be eliminated, which leads to decreased scrap and increased yield (Fig. 5).
Coil validationBased on defined criteria the system helps to set mechanical and chemical limits by product. During an involuntary slow-down of the line, the system defines the exact slow-down percentage up to where the compliance of the final strip with the given criteria is not affected.
OPExS allows the line to be run under criteria set by either a CMI expert or the steelmaker, but it can be easily and quickly updated to reflect any other specifications, like those related to the final customer’s quality needs. It adjustment of the line’s quality specifications – and coil validation – and adjustment based on various final customers’ quality needs and related grading rules. The same processing line can
produce product in accordance with the specifications and requirements of various final customers.
The system offers the following benefits: • Translation of final product
characteristics into process and product parameters, as well as process steps and tolerances (Fig. 6).
• Trial runs when deviating from the process and production path defined by CMI experts if, say, the necessary steel grade is not produced by the steelmaker.
Conclusions• OPExS allows optimisation of line
settings based on data analysis from processed coils, as well as upstream data analysis and end-event reporting.
• The system provides line operators with context information related to the customer’s processing specifications as well as those set by final customers. The corrective or preventive action to be taken
is identified based on this analysis and available within minutes after the coil has been processed.
• Markers indicate the origin of problems and specifies required manual intervention when needed. The system displays similar events for comparison.
• The system can ‘learn’ and continuously updates its database with acquired knowledge from daily strip processing.
• A display of similar cases for comparison is provided along with on-site know-how assistance and expertise and support to secure audits and certifications.
• Ease of implementation for single processing lines and lines combining several processes. Here, it helps with the steering of this complexity and helps steelmakers increase production flexibility and produce products according to market requirements – implying the lowest possible capital expenditure. t
Fig 5. Recorded process parameters can be
displayed
Fig 6. Translation of final product characteristics
Testing & Analysis dubois 2.indd 3 1/25/16 11:44 AM
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SITEVISITS
LASER based measurement systems are generally have one of three main functions.
• To detect the positioning of an item using through beam, retro-reflective and scanning sensors;
• Distance sensing based on time of flight or triangulation;
• Measuring speed based on the Doppler principle.
Innumerable applications can be thought of and implemented in steel plants using these sensors. Examples include positioning of hot and cold steel stock on roller tables, loop sensing in long product mills, edge guide and centre guide detection, alignment of sheet, detection of objects in reheating furnaces, coke oven alignment for pusher and guide cars, profile and dimension measurement. In strip mills they are used to detect speed, strip flatness, camber, shape, welds in continuous lines, determining the degree of alloying in coating lines, crop measurement and so on.
Today, many of these solutions are common, especially in green field plant or newly refurbished units. However, sometimes there are unusual applications that require a customised and ingenuous thought process.
Multi-pronged approach neededImplementing such a system successfully in an existing unit is not always straightforward and requires an innovative and multi-pronged approach. The R&D Centre for Iron and Steel at SAIL, India, has strategically designed, developed
and successfully implemented several laser-based applications, ranging from steelmaking to rolling mills, to enable improvements in performance.
Bokaro Steel LtdControl of caster mould widthIn the slab caster, it is essential that the distance between the mould plates is determined accurately to maintain casting speed and control the mould taper. At Bokaro Steel Plant (BSL), there was no on-line measuring of this or a control system for mould width and taper. During changeover of the casting width, manual adjustment had to be carried out, adding more than 90 minutes to machine preparation time.
An innovative on-line measuring and control system was designed, developed and implemented to determine the position of the narrow mould plate, using non-
contact lasers and sensors and a PLC, all interfaced with an existing control mechanism to move the mould plates to set the slab width and mould taper.
Four sensors are employed – two per mould plate – each independently controlling a motor to position the plate (Fig 1).
Installation in this application was difficult, requiring much improvisation due to grease, severe space limitations and high temperatures. The four sensors are mounted on specially designed brackets retrofitted in the mould cassette to directly measure the movement of the narrow plates. The analogue signal from the sensors is interfaced with the existing PLC to calculate the required mould plate separation and operate the mould plate motors.
Cold adjustment of mould width was to an accuracy of +2mm.
METROLOGY 47
www.steeltimesint.com January/February 2016
Laser measurement explained
1 Authors are with RDCIS ( Research & Development Centre for Iron & Steel ), SAIL (Steel Authority of India Ltd ), Ranchi , INDIA. 2 Authors are with Bokaro Steel Plant , SAIL, Bokaro, INDIA. 3 Authors are with Bhilai Steel Plant (BSP) ,SAIL, Bhilai, INDIA
Measuring solutions using lasers are now available commercially. For specific requirement on older equipment, customised and ingenuous solutions maybe required. Such implementation can best be carried out by in-house expertise through customised development keeping in mind existing plant logistics. By R Prasad1 , S Ilangovan1 , A Sharan1 , D Kumar1, 1 V Kumar1 , A Prasad1 , Dr(Mrs) U Rani1, B N Ghosh1, S Majumdar1, R Kumar2 , PSK Murthy2, A Kumari3
Fig 1. Operator display for
mould plate width and
taper control
Actual size before taper 1305
testing metrology Tim.indd 1 1/22/16 2:23 PM
Cutting hot-rolled coil to length A laser Doppler sensor was used to control the flying shear to cut hot rolled coil to lengths ranging from 4.5m to 10m. Located at the hot rolled coil finishing shop of BSP, the flying shear had previously been controlled by a conventional servo roll encoder and a dedicated controller block to measure strip length and initiate the cut command at the appropriate time. This method posed several maintenance and running problems. Other related issues were mis-cuts and length variations in cut sheet, resulting in rejected sheet and sometimes jamming of sheet in the packing piler.
An automatic cut-to-length system based on a state-of-the-art laser speed sensor was designed, developed and implemented successfully at shearing line No1 (Fig 2). Accurate speed determination calculates the length to be cut by integrating speed over a short fixed time interval. The output of the speed sensor – a Laser Doppler Velocimeter – is a train of pulses corresponding to the speed of the strip to be cut and these pulses are counted by a high speed counter module in the PLC. All other logic and interlocks are interfaced to the PLC including the coil tail end sensor, the cut command to the flying shear drive, the brake command to stop the shear drive and thereafter the stop command to the flying shear motor.
The results achieved through the implementation of this auto cut-to-length system have a consistent accuracy of 0.65% of the set length as against 1% achieved by the earlier encoder method. Backlash is eliminated when measuring sheet length (Fig 3).The control logic also eliminates large variations in length, at the first cut, intermediate cuts and last cut, as occurred in the earlier system.
Auto slow-down at pickling line Hot rolled coils from BSP’s hot strip mill, have a layer of oxide scale with a thickness of 5-20µ. The strip is de-scaled by a combination of mechanical fracturing and chemical dissolution in the pickling line. At continuous pickling line No 1 of the cold rolling mill, the pickling solution is diluted sulphuric acid (H2SO4). Pickling takes place in a continuous processing line consisting of three independent sub-units: entry; process and exit sections.
In the continuous processing line, the tail of the strip passing through the line is welded to the head of the next coil to be pickled. The strip at the welder is momentarily stopped to achieve this, but the strip in the pickler tanks continue to travel by means of an entry looper pit which stores sufficient material to feed the pickling tanks. After welding, the line speed at the entry section is increased to a maximum of 10mps. Before reaching the end of the coil in the pay-off reel (un-coiler), it is necessary to reduce line speed to prevent the tail of the strip falling into
the looper pit, which would prevent it being welded to the head of the next coil. Due to the lack of a proper scheme to predict the correct time to initiate slowdown, extra precaution was taken by the operators to slow the line speed early in anticipation of reaching the end of the coil, this adversely affecting line productivity.
A laser sensor and control system has been commissioned to control the speed of the pay-off reel in order to maintain a faster entry line speed closer to the end of the coil. The laser beam is focussed on the strip surface on a coil lap before it pays-off and records the increasing distance between sensor and coil as the coil diameter decreases as the strip is paid-off. The changing value is shown on a digital display and the line is automatically slowed when pay-off nears the end of the strip. The new system has eliminated the effects of roll slippage and input thickness of the coiled strip (Figs 4 and 5).
A reduction in the slow running of the coil by about 120 seconds has also been achieved. The new system has helped to increase the entry section line speed from 4.8m/s to 6.2m/s improving productivity by 12% (from 4.47coils/h to 5 coils/h). There are distinct advantages over the old method in terms of better speed control, more user friendliness and faster fault diagnosis.
Looper storage in pickling line The pickling process takes place in a series of tanks containing cleaner, acid and rinse. The quality of this process partly depends upon the accuracy of speed regulation through these, as well as tank parameters. To maintain the required process speed, entry and exit sections are provided with online storage of the strip in the form of horizontal loopers. Up to 300m of strip can
METROLOGY48
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Fig 3. Trend of cut length accuracy using laser Doppler measurement
Fig 2. Automatic cut-to-length control for HSM flying shearOperator’s desk &
HMI display
Interlocks (field signals)
SET length
Display
Un-coiler
Looper
LDV
Pinch roll
Flying shear
Tail end sensing
Output of the sensor
Output to driveregulation/control circuit
of flying shear motor
Controller(PLC)
6370
Maximum tolerance
Minimum tolerance
Set length
Actual length
Leng
th in
mm
6360
6350
6340
6330
6320
6310
6300
6290
6280
6270
62601 2 3 4 5 6 7 8
No of observations
9 10 11 12 13 14 15 16
testing metrology Tim.indd 2 1/22/16 2:23 PM
Metals page with bleed copy.indd 1 23/12/2015 10:13
be stored at the entry section and 200m at the exit section. Information about strip length stored at any point of time is essential to optimise the line speed. The required pickling speed of can be maintained only if the loopers function correctly and information regarding the amount of strip available as a buffer is available to operators. The existing Selsyn system to measure strip in the loopers was erratic, had limited accuracy and was difficult to maintain due to obsolescence. Incorrect information about the amount of strip in the loopers was leading to reduced line speeds and derailment of the looper trolley.
A new state-of-the-art system was designed and implemented using a laser distance sensor. Leuze lasers were chosen because of their capability to measure distances of up to 200m. They were installed to view the entry and exit looper trolleys (Fig 6). The long distance range (almost double the trolley travel) was selected so that reliability could be assured. The sensor was attached to a vertical mounting structure designed to take care of platform vibration. The mounting provides the sensor with a degree of freedom to adjust focusing in the horizontal and vertical axis. The sensor is also equipped with a pilot red laser beam to assist in focusing the sensor onto a reflector fixed to the looper trolley.
Due to the long distances being measured a special pre-fabricated diamond reflector was mounted on each trolley to reflect the laser light back to the sensor.
Output varied with signal strength, depending on the distance of the trolley from the sensor. A Motron converter and display unit was installed in entry pulpit No3 so that, apart from displaying the single strength indicator (SSI) values, it was able to convert the signal to 4-20mA and relay this to exit pulpit No4.
The new system measures and displays the distance travelled by the looper trolley both at the entry (uncoiler) and exit (coiler) pulpits. In the uncoiler pulpit, only the entry side trolley distance is displayed whereas in the coiler pulpit, both entry and exit trolley positions are displayed. The positions of the trolleys provide a measure of the length of strip in the looper.
The accuracy of measuring the position of the trolley has a maximum error of 0.5m, which is within acceptable limits.
An improvement in productivity by 4-6 coils per hour (av coil wt 15t) has been achieved due to the increase in line speed possible from 4.8m/s to 6.2m/s.
Bhilai Steel PlantDetermining slab length At BSP’s slab caster No 1, the slab length was previously measured using a contact bar. The bar consisted of a metre-long metallic rod hung over the slab from a cantilever arm set at the required distance from the start position of the gas cutting torch trolley. The trolley travels with the slab as it makes a transverse cut. As soon as the front end of the slab made contact with the rod a gripping mechanism was attached to the slab causing the cutting trolley to move with the slab to enable a transverse flame cut to be made across the slab. When the cut was completed the trolley returned to its initial position ready to follow the next slab with the cutting torch.
Two laser sensors are used in the new system, one aimed on the front end of the slab to track its position (laser L1), the other to track the movement of the gas cutting trolley (L2).
L1 measures slab length from 5.5m to 11m with respect to the start (home) position of the gas cutting torch trolley.
L2 measures change in the position of the gas cutting trolley as it moves with the
METROLOGY50
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Fig 5. Picture montage of equipment to monitor reducing
coil diameter
Fig 6. Schematic of entry and exit loopers with central location of sensors and entry and exit pulpits (posts 3 & 4).
Process
Rope drums
Fixed
Sensors1000m max
Post-3
Entry looper Exit looper
Post-4
Fixed
Separate motors to create tensionM
Fig 4. Laser-based auto entry slow-down in pickling line
230 V AC10 K
resistor 2W relaycoil
Controller Interfacingcircuit/scheme
280 V DC output
DS
Sensing
Coil yard
Un-coiler with coilPinch roll Welding
machine
Pickling process
Sensormounting
Wet loop pit3500 mm
Sensing
2400 mm
DS
Here initiation of auto slow down
Un-coiler with coil
Coil conveyor
DS: LASER Distance sensor in housing
Russianbridge circuit
Output to driveregulation/control circuit &display in operator’s cabin
Principles, Design and Raw Materials:Historical Development and Principles of the Iron Blast FurnaceBlast Furnace ReactionsEnvironment Issues in Blast Furnace Ironmaking
Fundamental Principles Applied to Blast Furnace SafetyBlast Furnace Energy Balance and Recovery: Rules of Thumb
It is an in-depth, week-long course held every second year. It covers every aspect of blast furnace ironmaking, making it invaluable for managers, operators, engineers, researchers and suppliers of equipment, refractories and raw materials. It is officially recognized by the American
Iron and Steel Institute. The lecturers in the course are acknowledged experts in their fields and the delegates come from diversified industrial backgrounds. The week-long course consists of 25 lectures given by experts in the field, supplemented by a computer game, and plant tours.
slab from its home point (at present, there is a variation in the trolley position from its home point of +75 to -50mm). (Fig 8).
The range of both sensors is more than 18m since the sensors cannot be mounted near the hot slab. Each one is contained in a water-cooled jacket which has a flow switch to trigger an alarm in the pulpit should the water flow fail. Air purging of the lens for cleaning is also catered for.
The slab holding device (gripper) is pneumatically controlled. Frequently, the air pressure fluctuates, adversely affecting slab length cut. The response time of the gripper varies from one to two seconds.
Slab lengthSlab length is calculated via a PLC using casting speed, withdrawal roll rpm and input signals from lasers L1 and L2. The incoming speed of the slab, cutting trolley position, and record of cutting details are recorded on an hourly and shift basis by a PLC. This has a PC type interface for the operator (HMI). The HMI is also used for entering the slab set length, heat number, steel grade and so on.
The length of the slab is calculated using:• The current slab length with respect
to the initial stationary position of the gas cutting torch (La)
• Current slab velocity (Va)• Change from initial position of the
gas cutting trolley (Lb), and• Length contribution due to the
gripping mechanism (Lg)
The derived cut length (Lc) = La + d/dt(Va)+ Lb + Lg
Implementing this system, reduces slab length error to ±12.5mm and improves overall caster by 1%.
Identification of over length billets To prevent over length billets being charged
to the reheat furnace where they cause jams, a laser distance measuring system has been installed at the charging grate to alert operators of oversized billets.
Two laser sensors are positioned on opposite sides of the charging grate so as to view each other across the grate at a set distance (L). As a billet, aligned with the laser beam, passes between them it interrupts the beam and each sensor instead measures the distance to the respective ends of the billet (L1 & L2). From this, the length of the billet can be calculated in the PLC as: BL = L – (L1 + L2). Lengths are displayed in the control pulpit and over-length billets set off a light as a visual alarm. Accuracy is within 5.4mm or 0.047% of normal billet length.
Since implementation, furnace availability has improved 10% as no over-length billets are now charged to the furnace.
A full description of this application will be found elsewhere in Steel Times International Jan/Feb 2016.
ConclusionsWhen new plant is installed, or existing units modernised, laser-based measuring
solutions are available commercially and are generally included as a package.
However, for a specific requirement in an older unit, customised and ingenuous solutions maybe required to provide simple-to-use and effective control systems at reasonable cost. This is best be carried out by in-house experts through customised development, keeping in mind existing plant logistics. t
AcknowledgementThe taskforce is highly indebted to the
management of SAIL for providing this
opportunity and continuous encouragement to
the taskforce.
The project taskforce acknowledges the
special support received from plant personnel
for providing the opportunity, guiding the
taskforce, encouragement and assistance in the
execution of all the tasks during erection and
commissioning and trials.
Bibliography1 Hot rolled steel sheets, plate and coils
mechanical cutting published at website www.
ruukki.com,
2 ‘Advances in non-contact length and speed
measurement with zero speed and automatic
direction detection for automation’ published in
ABM, Lannac , 2010, October 27, Belo Horizonte,
MG, Brazil.
3 Technical catalogue on ‘Laser Doppler Speed
and length measuring sensor systems specific
to the metal and steel industries’ M/s. Proton
Products International Ltd, England.
4 ‘Laser Doppler Velocimeter for velocity
and length measurement of moving surfaces’
published in Applied Optics, Vol 23, No.1 Jan
1984 by Optical Society of America.
METROLOGY52
www.steeltimesint.com January/February 2016
Fig 8. Slab length control on caster using two laser sensors
Fig 7. Sensor fixed in
looper and reflector
mounted on moving
looper trolley
Laser sensor Diamond grade reflector
Slab caster
TROLLEY
Laser sensors
Trolley position tracking
Slab front end tracking
testing metrology Tim.indd 4 1/22/16 2:23 PM
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1. How are things going at Danfoss? Is the steel industry keeping you busy?Danfoss acquired Vacon in December 2014 and merged Danfoss Power Electronics and Vacon into Danfoss Drives. After the merger, we are globally number two in AC drives. We see great potential in steel and we are busy, but we want to be even busier as we can help the industry much more in meeting new and challenging sustainability targets.
2. What is your view on the current state of the global steel industry?The capacity and markets are setting short-term challenges, but the new additional targets for the industry are coming from corporate responsibility and sustainability.
3. In which sector of the steel industry does Danfoss Drives mostly conduct its business?We are everywhere. Our AC drives are used for controlling the speed and torque of electrical motors starting from mining of iron ore, throughout processing lines and finally to the cranes in the shipping
area. Our are used to control non-motor applications such as electromagnetic stirring. The other Danfoss business segments: heating, cooling and power solutions provide energy-efficient solutions for the industry, too.
4. Where in the world are you busiest at present?US, China, India and Europe.
5. Can you discuss any major steel contracts you are working on?We have several contracts at different stages. Most are with companies that deliver total automation and electrification to the mills. In several cases, their deliveries also include main equipment to the mills. As a pure AC drives supplier Danfoss Drives is not a project house, but we co-operate well with the companies that deliver projects and we execute the tasks that need AC drive-specific expertise.
6. Where do you stand on the aluminium versus steel argument?It is the application and the customers that set the requirements and then engineers find the most feasible solutions and define the materials. Use of aluminium in automobiles has increased, but high-strength steels are also offering lighter weight to the applications. In general, the total amount of steel used in the world is far greater than aluminium.
7. “While there will be increased aluminium penetration, vehicles will continue to be predominantly steel,” said Ducker Worldwide’s Dick Schultz. Is he right or wrong?I’ll include all vehicles to the topic. In some categories of vehicles, like aeroplanes, aluminium has been leading for a long
time. However, composites are coming. There are many different categories of vehicles and many of them will be made from steel in the future, for example, off-highway vehicles used in farming, and large ships.
8. “Within the next 15 years or so there could be a nearly even split between steel, aluminium and carbon fibre content in the average North American produced light vehicle.” So said Jay Baron, president of the Centre for Automotive Research. Who is closer to the truth – Dick or Jay?When the target is lightweight, then the share of lighter materials increases. When the target is something else, the share of materials will be different. I guess the truth is that new materials and new production technologies enable new solutions for energy efficiency and cost.
9. Is aluminium the ‘greener’ metal when compared to steel. What’s your view?There can be significant differences depending on whether the lifecycle emissions are mostly in the production of metal or from the actual usage of the equipment that is made from the metal. By recycling, a new cycle will be started with lower energy consumption.
10. “…any hint of doubt when it comes to predictions of climate doom is evidence of greed, stupidity, moral turpitude or psychological derangement.” This is a quote from Bret Stephens writing in The Wall Street Journal. Do you sympathise? The recent Paris Agreement on Climate gives us a clear direction. Danfoss was actively participating in the COP21 in Paris.
PERSPECTIVES: DANFOSS DRIVES54
www.steeltimesint.com January/February 2016
The need for steel won’t disappear
* Global director, machine building and industry
Denmark-based Danfoss Drives, sees great potential in the steel industry and is currently very busy in the USA, China, India and Europe, says Jussi Sihvola*
perspectives new.indd 1 1/25/16 3:31 PM
project members and provide application, process and service expertise for green field projects and modernisations.
15. How do you view Danfoss Drives’ development over the short-to-medium term in relation to the global steel industry?The VACON products and technologies are already recognised by the leading automation and equipment suppliers in the steel industry. The new Danfoss Drives and our position as the second-largest AC drives supplier is not fully known, yet. Better recognition will also support our partners who deliver the projects.
16. China dominates global crude steel production and is accountable for almost half of total production. How should the industry react?China has a leading role in many other industries, too. Competition is tough and requires innovation in the field of one’s own expertise by understanding customer needs and meeting them at a level that ensures the customer will be successful in his own business.
17. The Chinese still rely heavily upon Western steel production technology. What is Danfoss Drives’ experience of the Chinese steel industry?The Chinese industry wants to develop its own competences and technologies. This is also happening in steel, but it takes time. Eventually, there will be Chinese innovations in steel production technology.
18. Where do you see most innovation in terms of production technologies – primary, secondary or more downstream?There are many possibilities for innovations. New product innovations are more from secondary towards downstream; and energy efficiency innovations are starting from the primary and go through all processes.
19. How optimistic are you for the global steel industry going forward and what challenges face global producers in the short-to-medium term?The need for steel won’t
PERSPECTIVES: DANFOSS DRIVES 55
www.steeltimesint.com January/February 2016
The company’s own climate target is to use half as much energy by 2030, and emit half as much CO2 from the energy it uses.
11. In fact, talking of ‘green issues’ and emissions control, how is the steel industry performing in this respect?Staying below the emission limits is not enough anymore as per the general opinion. There is a need to show proactive sustainability efforts. This also concerns other industries. Leading steel companies are communicating about their proactive activities. Saving energy will save some operational and most probably maintenance costs, which then release money for further emission-control investments. Some companies and mills are more active than others, and that gives them some advantage.
12. In your dealings with steel producers, are you finding that they are looking to companies like yours to offer energy efficiency and sustainability solutions? What can you offer them?Energy savings and process-control improvements are the key benefits of AC drives. Compared to constant speed, the speed control of AC motors can, in many applications, save up to 30% of energy. The key products that we offer for the steel industry are the VACON® NXP System Drive and VACON® 100 INDUSTRIAL and both with related services.
13. How quickly has the steel industry responded to ‘green politics’ in terms of making the production process more environmentally friendly? Environmental friendliness is a strong trend that needs to be followed. Many companies started a long time ago and will succeed. Few companies or mills have already lost the battle and are closing down.
14. Where does Danfoss Drives lead the field in steel production technology?We excel in the speed and torque control of motors with our AC drives. This enables smooth and accurate control of process equipment. We globally support the entire lifecycle of VLT and VACON drives. As AC drive specialists, our experts work with all
disappear. There is a need to invest in energy efficiency and sustainability so that companies will be ready when the markets recover. Investing when the market is down is risky, but waiting too long creates maybe an even higher risk.
20. What exhibitions and conferences will Danfoss Drives be attending this year?Danfoss Drives participates globally in 25 exhibitions and conferences. Additionally, we organise our own customer and industry events. The global Drives Conference for our customers is the largest AC drives-focused event in the world.
21. Danfoss is based in Denmark, but what’s happening steel-wise in the country?The Danish steel industry is facing international pressure, but survives through focus and specialisation.
22. Apart from strong coffee, what keeps you awake at night?Sometimes thinking about the new opportunities is too interesting that going to sleep can be delayed. In any case, I sleep well at night.
23. If you possessed a superpower, how would you use it to improve the global steel industry?The most modern technologies would be taken into use so that the steel industry would lead the way in sustainability. t
perspectives new.indd 2 1/25/16 3:31 PM
IN 1914 UK steel output reached 7.83 million long tons. Open-hearth steelmaking predominated at 83.6% of production.
Acid steel was considered superior in quality to basic steels, accounting for 56.2% of open hearth (OH) output in 1914 and 62.4% of Bessemer output, a decrease over 1913 when the share of acid steel was 62.9% OH and 65.5% Bessemer. Why? Because the war restricted imports of high grade acid ores resulting in ironworks relying on domestic ores. In 1915, the share of acid steel increased to 58.7% OH and 68.1% Bessemer steel.
In 1917 the Minister for Munitions, Dr Addison, called for a 50% growth in UK steel capacity – a figure not achieved in practice. In 1917 steel output of 9.873 million metric tonnes was the peak for the war effort and would not grow by 50% until 1948 – when it reached 15.1Mt.
Electric steelmakingElectric steelmaking was in its infancy, commencing on a modest scale in 1915 when 22kt (metric tonnes) were produced, a figure that peaked during the war years in 1918 with the production of 128kt, an output not exceeded again until 1936.
Many early designs of electric arc furnaces were being tested at this time. One such arc furnace advocated towards the end of the war years was the ‘Stobie’, a single electrode entering vertically through the roof, protected from oxidation by enclosure in a chamber. The Stobie could turn open-hearth steel into a higher quality product than acid open-hearth and at a lower cost.
Special steelsPre-war, Sir Robert Hadfield had visited the Krupp works in Essen and later commented on their advanced R&D in special steels observing ‘we have nothing of the kind in Britain’. He also commented on Krupp’s ability to cast ingots weighing up to 110 tons using the crucible process, lamenting that such steelmaking technology was first developed in England around 1750.
Pre-war, most special steels were imported from Germany. Modest amounts were made in the UK by the crucible process and carburisation of bar steel was still taking place in cementation furnaces in areas such as Sheffield.
Belgium had also developed production of special steels and, following the outbreak of war, it was proposed that steelmakers among Belgium refugees should be recruited to work in British steel plants. However, UK Labour Exchanges were ill-equipped to locate these skilled workers and few ended up in appropriate employment.
Innovative steels such as ‘Cobaltcrom’, an air hardening high speed tool steel, were developed during the war, offering up to a 50% increase in cutting tool life and hardened without the need for normalising.
The inventor of the steel also developed a temperature-indicating salt called ‘Pyreks’, to indicate, by starting to solidify, when the steel should be removed from the furnace. Using this, heat treatment could be achieved in a Smith’s hearth by protecting the steel in a ceramic tube.
During hostilities German patents were
recognised but sometimes suspended or negated if the product was needed for the war effort. In 1917 a patent for high-speed steel containing cobalt, previously granted to Stahlwerk Becker, was challenged by Darwin & Milner and Arthur Balfour & Co on the grounds that a similar product containing 15% Co had already been developed in Sheffield.
The war years witnessed a steady growth in steel output in the UK, followed by a sharp decrease in 1919 (to 8.021Mt) following the end of hostilities in November 1918. A short-lived recovery occurred in 1920 (9.213Mt), but output fell 60% in 1921 to 3.76Mt (Fig 1). Output remained volatile for 16 years after the War with recessions followed by the Great Depression of the 1930s, output at last growing consistently from 1935. t
HISTORY56
www.steeltimesint.com January/February 2016
The Great War and UK steelmaking
* Dr. Tim Smith, consultant editor
Charging open hearth furnaces at Dorman Long, Redcar
works, Teesside
There was steady rather than dramatic growth in UK steel output during the years of the Great War, followed by a sharp decrease in 1919 following an end to hostilities in November 1918. A short-lived recovery occurred in 1920 (9.213Mt), but output fell 60% in 1921 to 3.76Mt and remained volatile for 16 years with recessions followed by the Great Depression of the 1930s. Output started to grow consistently from 1935 output at last growing consistently from 1935. By Dr. Tim Smith*
History new.indd 1 1/22/16 2:25 PM
Two powerful companies in the metals industry have forged together. Mitsubishi-Hitachi Metals Machinery and Siemens VAI Metals Technologies have united to become the new global force in metals technologies.Creating the future of metals as one.
The long standing problem with flatness control in multi actuator mills is now solved by ABB. To optimally make all mill actuators work together as a team is a complex task. Different actuator combinations will in these mills give the same flatness effect. The problem is to select the one actuator combination with the minimum actuator movement. The ABB patented method of Extended Singular Value Decomposition (ESVD) will optimally make this selection and make your actuators work together as a genuine team.Stressometer Systems. www.abb.com/stressometer
