Iron, Steel and Coal

12
Steel and Iron Industry
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Transcript of Iron, Steel and Coal

Page 1: Iron, Steel and Coal

Steel and Iron Industry

Page 2: Iron, Steel and Coal

Intro to Steel and Iron Industry

• Used numerous other types of industry:– Car– Construction– Railway

• Made through the process of 3 raw material:– Iron ore– Coal– Limestone

Page 3: Iron, Steel and Coal

Industrial system at Llanwern

• Very expensive process

• Led to integrated works

Page 4: Iron, Steel and Coal

Over-exhaustion

• Boom of the steel industry during the WWII led to over-exhaustion has led to the diminished levels of raw materials in UK and EU.– Despite the improved more efficient technology and

methods used in the industry. (i.e. Blast Oxygen Furnace used in Llanwern)

• Led to imports of iron ore, coal and limestone from:– Australia– Sweden– Canada– Columbia

in the UK.

Page 5: Iron, Steel and Coal

Globalization

• Globalization of an industry is the growth of the industry to reach a global or worldwide scale.

• Resulted in cheaper higher quality to steel from places like Latin America, South Korea and the far east in general.

• Due to cheaper labour costs in those areas.

• Western steel industry has become less competitive.

Page 6: Iron, Steel and Coal

Ruhr Region Germany• Ruhr region is a region greatly

affected by globalization of industry.

• Higher labour costs, higher transport costs, higher running costs add up to higher production costs.

• This means German steel costs more than its counterparts from LEDCs despite being the same.

• With cheaper imports from places like S.E. Asia, it has become harder for the German steel industry to remain competitive and has suffered a decline as a result.

Page 7: Iron, Steel and Coal

Key:

Integrated plants: combined steelmaking and rolling mills.

Other Rolling Mills

Coating Mills

Wire Mills

Tube Mills

• Attempt to combat high costs (i.e. labour, transport, raw materials) led to the introduction of integrated works where all the processes for making the steel is done in just one plant:– Port Talbot– Teesside– Scunthorpe

• Break of Bulk Point decreases

Page 8: Iron, Steel and Coal

Location

• Difficult to build large integrated steelwork factories.

• Requires large areas of flat land.– Port Talbot and Llanwern have expanses of

coastal dunes and mudflats available for development.

• Needs to be accessible.• Rationalization another solution to bring

about efficiency.

Page 9: Iron, Steel and Coal

Rationalization

• Rationalization in economics is:– practical application of knowledge to achieve a

desired end. (Purpose is to bring efficiency)– Privatisation and downsizing usually the most

successful way.

• Decline in the Steel Industry Sector led to privatisation of UK steel industry in 1986.

• This consequence were rationalization and major downsizing to make smaller factories.

• Jobs lost in the process.

Page 10: Iron, Steel and Coal

Llanwern steelworks Renewal• Llanwern Steelworks renewal project was outsourced to St Modwen

Properties PLC after closure in 2001.• 1300 jobs were lost as a consequence.• A £115m renewal project led by St Modwen Properties PLC is transforming

the former steel-producing part of the Llanwern steelworks site and envisages to create 6000 jobs.

• Anticipated to be finished by 2026-8• Rationalization has also led to closures of other plants such as Corby.

– Deemed unprofitable

Page 11: Iron, Steel and Coal

Interdependence on Other Industry

• Most construction industries like the Steel and Iron industry are heavily dependant on the current economic climate.

• For example, currently the car industry is going through a difficult stage.– Because people wish to save up more money

rather than spend it on luxuries like cars.• Production of cars slow down so less steel is

required.• Steel industry also takes a hit on profits, production,

demand etc.• During the Great Depression in the 1930s, heavy

construction nearly ceased altogether.

Page 12: Iron, Steel and Coal

End notes • Heavy manufacturing in the UK has been in

decline for many years.• Most likely for this pattern to continue.• Reasons include competition from overseas,

particularly S.E Asia, poor management, lack of investment, outdated working practices and expensive workers.

• Many countries like the UK have resorted to the tertiary sector to make money.