Dr Neil J. Bristow · 2016. 3. 29. · 05-Dec-2011 1 Dr Neil J. Bristow Presentation at OECD...
Transcript of Dr Neil J. Bristow · 2016. 3. 29. · 05-Dec-2011 1 Dr Neil J. Bristow Presentation at OECD...
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05-Dec-2011
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Dr Neil J. Bristow
Presentation at OECD Steelmaking Raw Materials Workshop
Paris, France 5th December 2011
H & W Worldwide
Consulting [email protected] +61240286268
1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
mailto:[email protected]
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05-Dec-2011
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• A year in two parts strong steel output/demand in H1 then weakness in H2 as economy slows
• Major dislocations to raw materials supply due to weather events in Australia and Brazil, strikes Canada
• Markets tight in early 2011, now softer, what happens if 2012 is stronger than predicted?
• Continued moves to change raw materials pricing – push to indices across iron ore and coal
• Emergence of new basins for coal and new iron ore impact more pronounced in 2012-3
H & W Worldwide Consulting
0
500
1000
1500
2000
2500
Mil
lio
n t
on
ne
s
Crude Steep production by Region
China India Asia ex China, India Europe NAFTA South America CIS Middle East
1,000
1,100
1,200
1,300
1,400
1,500
1,600
1,700
1,800
1,900
2010 2011 2012 2013 2014
Millio
n t
on
nes
Steel and pig iron production growth
Crude Steel
Pig Iron
H & W Worldwide Consulting Source: WSA, H&W Worldwide Consulting
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3
0
200
400
600
800
1000
1200
1400
1600
1800
Mil
lio
n t
on
ne
s
Pig Iron production by Region
China India
Asia ex China, India Europe
NAFTA South America
CIS Middle East
60
62
64
66
68
70
72
74
Pe
rce
nta
ge
Global BOF Production Share
Rise of
China
Forecast
China’s growth will raise BF/BOF share by ~0.8% in 2012-3, as the majority of the global pig iron increase derives from Chinese growth in BF productivity and expansions relying mainly on imported raw materials.
H & W Worldwide Consulting Source: WSA, H&W Worldwide Consulting
Vast low cost high grade iron ore reserves
No met coal
No scrap/some merchant pig iron
Favour BF/BOF
Vast high grade iron ore reserves
Very limited met coal
No scrap/some sponge iron
Favour BF/BOF
Limited iron ore reserves
Some met coal
No scrap/minor DRI
Favour BF/BOF + EAF
Vast iron ore reserves
Extensive met coal
Scrap/some DRI
Favour BF/BOF + EAF
Low grade iron ore reserves
Large met coal reserves
No Scrap
Favour BF/BOF
SE Asia
China
Russia
India
In addition to China steel growth to 2014 will be driven by other countries, with a majority favouring the BF route relying on imported seaborne coking coal and domestic iron ore.
Brazil
H & W Worldwide Consulting
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Oxygen enrichment
Pulverised Coal Injection
Deadman
Recent Blast Furnace Changes:
– Reline enlargements
– Pulverised coal injection
– Oxygen enrichment of the blast
– Larger working volumes
– Low gangue feed
– Bosh / Hearth cooling
– Computer control / heat & mass
balance models
– Instrumentation advances
The BF has been the King and has seen of many challengers. It will remain the main producer of iron for
steelmaking into the future, no change in near term.
H & W Worldwide Consulting
Iron Ore 0-25%
Sinter 50-85%
Pellets 0-100%
Coke 650-290kg
Pulverised coal injection 0-220kg
Natural Gas 0-60kg
Fuel Oil 0-100kg
Lump Ore Coke
• Raw Materials costs ~60-75% of liquid steel costs
• Transportation costs ~ 6-15% of liquid steel costs
H & W Worldwide Consulting
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H & W Worldwide Consulting
Key roles of
coke in the BF
1. Energy
2. Source of Carbon
3. Strength
4. Permeability
Molten slag
Gas flow (coke)
Liquid flow
Sintered Ore Coke +
Carbon monoxide
+
Iron oxide
Carbon dioxide
+
Iron
Coke
+
Oxygen
Carbon
dioxide
Molten iron
Carbon
monoxide
Carbon dioxide
+
Coke
Key takeaway no
change in coke
quality
Key roles of
Ferrous materials
in the BF
1. Low RDI
2. Strength
3. Even softening
/melting
4. High reducibility
Molten slag
Gas flow (coke)
Liquid flow
Sintered Ore, lump, pellets Coke +
Fe2O3 + CO
Coke
+
Oxygen
Carbon
dioxide
Molten iron
H & W Worldwide Consulting
Carbon
monoxide
Carbon dioxide
+
Coke
Fe2O3 + C
CO2 +
Fe (l)
Key takeaway no
change in ferrous
quality
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Tumble /Shatter Index
Decrepitation
Reduction Degradation Index
Reducibility
Softening/melting behaviour
ferrous
burden
quality
No change in near term for ferrous burden materials as BF remains core production unit. Increased
productivity, lower fuel and slag rates remain key targets for ironmakers.
H & W Worldwide Consulting
Diagram: Techint
Heavy melt Scrap
50 100% Shredded Scrap
0 – 50%
HBI
0 – 40% DR ore
0 – 80%
Some EAF’s have coal/oxy injection
for additional heating
EAF drivers will also remain unchanged, with adjustments to feedstocks as EAF steelmakers seek to
move up the value chain into higher quality flat products, SB’s etc - rising need for DRI, premium scrap
H & W Worldwide Consulting
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Melting rate Resistance to hot oxidising
gases
Carbon content
Size
DRI poor poor average excellent
HBI poor average average excellent
Heavy melting scrap
average average poor poor
Shredded scrap high density
average/
excellent poor poor excellent
Pig Iron excellent excellent excellent excellent
Liquid Iron excellent N/A excellent liquid
Increasing EAF use is not all bad for the BF, as merchant pig iron makes an excellent part feed for modern
EAF’s as does liquid hot metal, BF linked to EAF’s in the future?
H & W Worldwide Consulting
Cost of iron ore and coking coal as percent of global HRC steel price
0%
10%
20%
30%
40%
50%
60%
70%
80%
1970 1975 1980 1985 1990 1995 2000 2005 2010
% o
f ste
el
pri
ce
Iron ore Coking coal
Major raw materials have risen very sharply in price and are now close to record % shares of the cost of steel based on HRC. This is driving steelmakers to seek to use cheaper and more difficult to use
steelmaking raw materials.
H & W Worldwide Consulting Source: Macquarie Research estimates, September 2011
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• Raw Materials Impurities • Increase fuel rates and lower productivity
• Can cause breakdown of coke, refractory attack
• Lead to recycling in BF and environmental problems
• Make BF slag unusable
• Freight • Increase costs and carbon footprint
• Losses and degradation during transport
• Stockpiles, dusts, environmental issues
• Supply and Quality • Increasing demand seeing moves to new materials from new locations
• Testing and evaluation of “new” raw materials
• Price of raw materials leading steelmakers to experiment with new
materials H & W Worldwide Consulting
Using carbon lean
sources
Smelting reduction
Modern blast furnace 2010
Advanced technologies
Partial reduction with
biomass or H2
Sequestration
Replace fossil carbon Improve efficiency
Development
CO
2 e
mis
sio
n p
er
ton
ne
of
ste
el 100%
80%
40%
60%
20%
0%
0 1 2 3 4 5 6 7
„Learning curve‟
1
2
4
3
Ta
rge
t
Modern blast furnace 2020
1a
5
Renewable carbon and capture
H & W Worldwide Consulting
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1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
• Natural iron ores (or direct shipping ores (DSO) or run-of-mine ores) – ores as extracted from mines and not subjected to any processes of beneficiation other than sizing. • Lump ore – ore consisting of coarse particles, typically with a minimum size
between 6 and 50mm.
• Sintering Fine ore – ore consisting entirely of small particles. Upper size limit usually between 6.3 – 10mm.
• Sized ore – ore prepared to meet specific size limits e.g. 6.3 x 30mm.
• Processed ore – ore physically or chemically (rare) treated to make them more suitable for use. • Concentrates – processed ores in which the iron content has been increased,
size typically 1mm to 0.125mm
• Pellet Feeds – processed fine ores which have been ground and beneficiated, size typically
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H & W Worldwide Consulting
The iron ore flow to Blast Furnace
Concentrate
Sinter plant
Pellet plant
Sinter
Pellet
Lump
BF
Fines
Pellet Feed
0 – 25%max
0 – 90%max
50 – 85%max
The iron ore flow to the DR Shaft
Concentrate
Pellet plant Pellet
Lump
DR
Pellet
Feed
~5%
~95% Grinding
Major ferrous raw materials flows are customer and region specific, increased variation is likely in the near future as new materials enter the market.
Primary Melt Formation
Granules Segregated Bed
Humidified
Granules
Sinter
Coarsening by
granulation
Charging on
machine
Humidification by
water condensation
Drying and calcination
Solid-solid
reactions Solid-melt
reactions
Cooling and solidification
Ore Mix
Drying
Calcination
Shrinkage/
cracking
Total melt generated
1. 2.
3.
4. 5. 6.
7.
These sub-processes
influence overall
sintering performance. The response of certain
ores can be quite different,
e.g. goethite, magnetite
H & W Worldwide Consulting
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70 92 113148
208 275326
384 444628
626678
0
200
400
600
800
1000
1200
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011e
(millio
n to
nn
es)
10
20
30
40
50
60
70
(Ch
ina
% s
ha
re o
f to
tal tr
ad
e)
World ex China China % share (RHS)
China iron ore imports and share of global trade
H & W Worldwide Consulting Source: CISA, China Customs, H&W Worldwide consulting
The rise of China saw seaborne iron ore grow very rapidly . Ex China seaborne iron ore has not reached pre GFC levels and is unlikely to do so in 2012-3.
Chinese iron ore imports are predominantly fines, estimated at ~90% of total figure with pellets ~5%
of the total; the majority being hematite. Magnetite is excepted to increase in the future.
China iron ore imports by source
Fines Lump Pellet Hematite Magnetite
Australia Yes predominant Yes very limited Yes majority very limited
currently will rise
Brazil Yes predominant very limited Yes Yes majority Very limited
India Yes predominant limited very limited Yes majority no
South Africa Yes predominant Yes no yes no
Ukraine Yes majority no Yes minority yes very limited
Canada Small no Yes majority yes very limited
Russia yes no yes yes very limited
Iran yes no no yes no
H & W Worldwide Consulting
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China
Other Developing
Developed
0
100
200
300
400
500
600
700
800
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Mil
lio
n t
on
ne
s
Incremental Seaborne Iron Ore Growth
23
Seaborne Iron Ore
Chinese imports will continue to grow as domestic supplies increase in cost and decline in grade , and as
significant additional supply comes on stream from major producers leading to reduction in domestic supply.
2010
2020
H & W Worldwide Consulting
133 134 136 145 153 136 138 157 170195
254307
358 376 388412 432
41 44 55 5255 70 92
111148
208
275
326
384444
628 626678
54%
34%
24%
60%
0
100
200
300
400
500
600
700
800
900
1000
1100
1200
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011e
0%
10%
20%
30%
40%
50%
60%
70%
80%
Domestic Iron Ore (62.0% Fe Equiv) Imported Iron Ore Domestic Ore Share Imported Ore Share
Source: CISA, China Customs, H&W Worldwide consulting
Million
Ton
nes
Accurate information on domestic ore is difficult to get due to under reporting, double counting but
domestic production is still rising to meet the need for iron units.
H & W Worldwide Consulting
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Beneficiation Balling High temperature reactions
90% passing 45µm
Magnetite - magnetic properties - in concentrate form - exothermic heating in pelletising
Hematite - generally more costly - in concentrate form
Hematite – goethite
(Australian)
X – less desirable because goethite lowers yield and hinders performance.
X – not ideal because generally sold as coarse sinter fines
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Source: Macquarie Research, company announcements, H&W Worldwide Consulting
0
100
200
300
400
500
600
700
800
2010 2011 2012 2013 2014 2015
mtp
a
Other
Assmang
Consolidated Thompson
Mt Gibson
Atlas
CSN
Anglo American
FMG
BHP Billiton
Rio Tinto
Vale
H & W Worldwide Consulting
Seaborne market likely to see significant growth to 2015, with ~65% projected to come from the “Big 3”.
Capacity growth has been far slower than announced – typically ~50% in delays and reduced output.
800
900
1000
1100
1200
1300
1400
1500
1600
1700
1800
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Mil
lio
n to
nn
es
Seaborne Iron Ore Supply Balance
Seaborne Demand (Imports)
Seaborne Supply (Exports)
Seaborne market remains undersupplied until major new expansions in Australia and Brazil come on
stream post 2013-4. Longer term planned expansions are ahead of demand growth.
H & W Worldwide Consulting Source: Macquarie Research, H&W Worldwide Consulting
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Iron ore Supply Quality
• Chemistry • Overall drift to lower grade in
many countries • Lower Fe,
• Higher SiO2 and Al2O3, • Higher P and LOI
• Physical Properties • Trends to finer size
• Reduced lump yield
• Lower metallurgical properties of lump
• Increasing ultra-fines – concentrates and pellet feed
• Ore Types • Trends to increased magnetite
• New Australian and West African magnetite
Iron ore Future Demand
• Chemistry • Overall demand for higher
quality ores and sinters • Lower gangue and RDI,
• Higher reducibility,
• Physical Properties • Trends to coarser size
• To granulate more finer ores
• Lump mix – stronger and higher grade less decrepitation
• Increased pellets
• Ore Types • Trends to optimise use
• Magnetite to pellets
• Hematite to sinter
H & W Worldwide Consulting
• Chemistry
• Increased BF slag volumes and rising P levels
• Move from lump to sinter/pellets
• Sinter yields challenged, increased RDI lower RI
• Higher silica loads – problems with slag granulation
• Physical Properties
• Increased pressure on sinter plant productivity
• Moves to manage increased ultrafine ores
• HPS sinter, secondary or selective agglomeration, micro pellets
• Rising magnetite – move to pellets as poor sintering
• Deterioration in sintering size – more concentrates poor
granulation
H & W Worldwide Consulting
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• Market dominated by China today and into the future
• Current tight market to remain, strong markets to
~2014
• Major new capacity coming on stream will balance
market – timing important
• Major changes in the future ore supply
• Many deposits to see grade decline
• More magnetite and finer ores
• India exports – decline?
• Chinese domestic production peaks and then declines
• Will lead to significant changes in BF burdening H & W Worldwide Consulting
1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
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• Simple definition Coking coal and injection coal (PCI)
• Coking coals (coals that enter the coke oven)
• Hard Coking Coal (HCC)
• Semi-hard coking coal
• Semi- soft coking coal
• “Fillers”
• PCI Coals
• Ultra low volatile coals
• Low and mid volatile coals
• High volatile coals and thermal coal
Declining quality, range of
properties and measures
Declining coke replacement
ratio, fixed carbon, energy
Seaborne market definitions are some what regionally specific, especially when it comes to further dividing
up coals into rank and volatile components.
H & W Worldwide Consulting
• Increased strength – larger BF‟s
• Higher CSR - higher productivity
• Larger mean size – increased permeability
• Lower ash – reduced fuel rates
• Move to HCC complimented by low ash CC’s
• Strong growth – emergence of India
• CRR rowing importance – coke price/cost rising
• Rapid burn no residual char – clean Deadman
• Low ash, high energy , low P, alkalis
Active Coke Zone/
Dripping Zone Blast
Raceway
Cohesi
ve
Zone
Coke
PCI
H & W Worldwide Consulting
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0
50
100
150
200
250
300
Mil
lio
n t
on
ne
s
Seaborne metallurgical demand 2000-2010
HCC SSCC PCI
Seaborne coking coal imports
150
160
170
180
190
200
210
220
230
240
250
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
Mil
lio
n t
on
ne
s
Total
Total Ex-China
H & W Worldwide Consulting Source: McCloskey, Macquarie Research, H&W Worldwide Consulting
Seaborne metallurgical coal market remains dominated by the HCC portion. PCI demand was curtailed due
to the GFC but is predicted to grow strongly in the future. The GFC saw China become a major coking coal
buyer, particularly of HCC coals.
HCC remains the largest portion of the increase, as expected with new ovens in India and growing HCC imports
into China. Larger BF’s & higher PCI also favour HCC demand.
HCC
SSCC
PCI
0
100
200
300
400
500
600
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
mil
lio
n to
nn
es
HCC
SSCC
PCI
0
50
100
150
200
250
300
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
mil
lio
n to
nn
es
H & W Worldwide Consulting
Coal demand by type Coal demand growth by type
Source : H&W Worldwide Consulting
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0
50
100
150
200
250
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
mil
lio
n t
on
ne
s
Seaborne Met Coal Supply
Australia USA Canada Russia Others
Australia 64%
USA 9%
Canada 11%
Russia 3% Others
13%
2010
No major changes in market structure major producers have retained position. USA retained ability to be
“swing” producer, Australian market share steady growth ~54% to 64%.
H & W Worldwide Consulting Source : GTIS, McCloskey, H&W Worldwide Consulting
Australia 56%
USA 23%
Canada 11%
Russia 3%
Indonesia 2%
Other 5%
Source: GTIS, H&W Worldwide Consulting H & W Worldwide Consulting
Australia is the dominant supplier of met coal to the market. The major 3 producers account for around
89% of the total supply, with US at record exports due to demand and Australian floods
Note: Severe floods in Australia has
reduced exports severe in Q1 and Q2
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Source: Macquarie Research, H&W Worldwide Consulting
Major seaborne supply basin
Major prospective supply basin
Major domestic supply basin
Tavan Tolgoi, Mongolia High political risk, no infrastructure in place, captive to Chinese market
Shanxi, China Dangerous, high-cost mining conditions, costs escalating on regulatory burden and RMB appreciation
Central Kalimantan High political risk, transport logistics uncertain
Bowen Basin Increasing costs, lower quality, no low-hanging fruit
Tete/Moatize Good mining conditions, challenging infrastructure
Appalachia Increasing costs, regulations, declining reserves Western Canada
High project development and operating costs, particularly in northern British Colombia, rail and port constraints near term.
Elga Challenging infrastructure, much delayed project
Kuzbass Large reserves, but very long route to coast and export markets
Very little new supply likely before late 2012, infrastructure close to capacity and recovery from
2011 flood event has been slower than predicted.
H & W Worldwide Consulting
2012 will see new coals from Mozambique, Mongolia and Indonesia enter the market, these are different to
traditional coking coals.
Source : GTIS, Australian Customs, H&W Worldwide Consulting H & W Worldwide Consulting
0
20
40
60
80
100
120
140
160
180
2008 2009 2010 2011a
millio
n t
on
nes
Major Met Coal Producers
Australia Canada USA
0
2
4
6
8
10
12
14
millio
n t
on
nes
Australian exports
SSCC HCC
US producers have increased exports in 2011 to make up for Australian losses due to the weather and are
expected to remain in the market as Australia and Canada grow.
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Source : GTIS, H&W Worldwide Consulting
Chinese met coal imports have declined in 2011 but continue to grow, from Mongolia . Australian
exports declined due to weather and pricing effects – Chinese swing price buyers
H & W Worldwide Consulting
-10
0
10
20
30
40
50
Total Australia Mongolia Russia USA Canada Indonesia
mil
lio
n to
nn
es
China import changes
2008
2009
2010
2011 YTD
Changes
0
50
100
150
200
250
300
350
400
450
500
Mil
lio
n t
on
ne
s
Seaborne Metallurgical coal exports
Vietnam
Venezuela
USA
South Africa
Russia
Poland
Other
New Zealand
Mozambique
Mongolia
Indonesia
Colombia
China
Canada
Australia
Seaborne market likely to see increase in 2012, subject to weather effects, with demand weak will China re-
enter the market?
H & W Worldwide Consulting
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22
• Trends for rising ash levels in new mines and some
new basins (Mozambique)
• General drift down in fluidity in number of regions
• New coals have different properties and characteristics
than current seaborne coals
• Vitrinite levels higher in new basins – new blends
• Reduced volumes of ULV PCI coals and rising P levels
• Widening quality range across HCC/SHCC/SCC
H & W Worldwide Consulting
• Trends for rising ash will see rising BF slag volumes
• Cokemakers will seek new blends with new coals
• Will high vitrinite levels see greater “carrying capacity”
• Will trends to ULV coals for PCI change to higher VM
coals?
• Search for high carbon, low ash fillers – increased use
of pet coke?
• Now to NG as an injectant or co-injectant for ash and
environmental benefits?
H & W Worldwide Consulting
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23
0
2
4
6
8
10
12
14
16
18
mil
lio
n to
nn
es
Chinese coke exports
China has supplied coke short regions such as Europe and US prior to the GFC. But with high duties and
moves to reduce energy intensive exports it is highly unlikely that will return to high levels of exports.
H & W Worldwide Consulting Source: GTIS
Source : GTIS, H&W Worldwide Consulting
Coke exports illustrate the extremely weak position in 2009, recovery in 2010 has been mixed and might
slowing, but what happens when ROW fully recovers if China limits exports?
H & W Worldwide Consulting
0
2
4
6
8
10
12
14
mil
lio
n t
on
ne
s
Chinese coke exports
2008
2009
2010
2011
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
mil
lio
n t
on
ne
s
Chines coke monthly exports
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24
• Mature steel industries tend to be coke short
• Europe, US etc
• India has a large merchant coke sector but remains coke short
• China has large (40%) tariffs on coke exports to reduce energy
intensive exports
• Other exporters are Poland, Russia and Ukraine, Australia could
join as it shuts one BF
• Who will replace China when markets return to pre GFC levels of
production if China doe not return to high levels of exports?
• Will new cokemaking technologies (HRCO) see more ovens built
or will another country replace China, e.g. India?
H & W Worldwide Consulting
1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
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05-Dec-2011
25
0
20
40
60
80
100
120
Mil
lio
n t
on
ne
s
Scrap exports
China India Asia ex China, India Europe NAFTA South America CIS Middle East Africa Oceania
0
20
40
60
80
100
120
140
Mil
lio
n t
on
ne
s
Scrap imports
China India Asia ex China, India
Europe NAFTA South America
CIS Middle East Africa
Oceania
US sees a growth export of scrap, mainly to selected Europe and Asia. CIS has declined as more is
now used domestically.
H & W Worldwide Consulting Source: WSA
400
450
500
550
600
650
700
750
Millio
n t
on
nes
Global Scrap forecast consumption
Rising steel production will see scrap demand increase in both BOF and EAF vessels. DRI will also
play an important part in steelmaking with coal based DRI/HBI likely to join gas based processes.
Source: Midrex, H&W Worldwide Consulting
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05-Dec-2011
26
Scrap 86%
Pig Iron 9%
DRI 5%
Overall metallics trade • Scrap the dominant traded metallic
• Most consumed where generated e.g. DRI,
• Rising impurity levels and move to higher quality steel boosting virgin
iron
• Environmental concern remains re
scrap – radioactive sources
• Future increased use internally in
CIS, possibly US
• Scrap pool in China ~2020 for
growing scrap based EAF
• Rise in coal based DRI
With growing demand for metallics will there is a shortage of scrap and increased investment in
alternatives such as DRI and even pig iron, especially in scrap short countries?
H & W Worldwide Consulting
1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
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05-Dec-2011
27
• ~90% of Mn is used in the steel industry mainly as ferroalloys
• Mn has no substitute thus increased steel demand = more Mn demand
• Mn use in steel had declined to ~2000 but has slightly increased due
to the advent of China
• Mn is also used in stainless steel with high levels in 200 series ~8%
• Most M alloys are HCFeMn and SiMn mainly used in flat and long
products respectively
• Majority of Mn ore is in South Africa, with high grade deposits in
Australia and Gabon
• China has large low grade deposits and needs to import higher grade
ore to make alloys for its strong steel production
• Mn has some environmental concerns and has challenged the industry
H & W Worldwide Consulting
Mn ore grade
Mn ore production
Major reserves of Mn ore are in South Africa, although grades are declining. High grade ores have a
more limited life in Australia and Gabon. Problems with infrastructure, power in South Africa and
Government policies have raised questions as to the future of Mn ore growth.
H & W Worldwide Consulting
-
05-Dec-2011
28
• ~90% of Mn is used in the steel industry mainly as ferroalloys
• Mn has no substitute thus increased steel demand = more Mn demand
• Mn use in steel had declined to ~2000 but has slightly increased due
to the advent of China
• Mn is also used in stainless steel with high levels in 200 series ~8%
• Most M alloys are HCFeMn and SiMn mainly used in flat and long
products respectively
• Majority of Mn ore is in South Africa, with high grade deposits in
Australia and Gabon, current problems in South Africa are a concern
• China has large low grade deposits and needs to import higher grade
ore to make alloys for its strong steel production
• Mn has some environmental concerns and has challenged the industry
H & W Worldwide Consulting
1. Brief Steel Outlook
2. Iron Ore Markets and Drivers
3. Metallurgical Coal and Coke
4. Scrap, Metallics and Direct Reduction
5. Manganese and FerroAlloys
6. Summary and Policy issues H & W Worldwide Consulting
-
05-Dec-2011
29
• BF will remain the major production route – current RM parameters will remain highly important
• Markets were tight in H1 in due to demand and weather events, now softer , possible recovery in 2012-3 back to tighter markets?
• Drift down to lower grade in many existing mines in Iron ore, Coking coal and Manganese ore
• New steelmaking raw materials will enter the market, finer higher grade ores and high ash and vitrinite coals
• Government policies are changing:
• Australia “leading” the way with MRRT and carbon taxes,
• China seeking to curb energy intensive exports.
• US making mine permitting more difficult
• Governments wanting to share in resources boom, Mongolia coal, copper
• Environmental pressures seeking curbs to mining and land allocation
• Land allocations becoming more difficult across many countries, in Asia,
Africa and Developed world H & W Worldwide Consulting
Thank you for listening
[email protected] +61240286268
H & W Worldwide
Consulting
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