Steel times international april 2014 by Quartz

April 2014 – Vol.38 No.3 – www.steeltimesint.com

EDWIN BASSON ELECTRIC STEELMAKING ENVIRONMENT

STEEL TIMES INTERNATIONAL – April 2014 – Vol.38 No.3

EXCLUSIVE INTERVIEW EUROFER’S GORDON MOFFAT

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CONTENTS APRIL 2014

2 Leader

April 2014 – Vol.38 No.3 – www.steeltimesint.com

EDWIN BASSON ELECTRIC STEELMAKING ENVIRONMENT

Front cover image courtesy of MTUS Technology. EXCLUSIVE INTERVIEW EUROFER’S GORDON MOFFAT

EDITORIAL Editor Matthew Moggridge Tel: +44 (0) 1737 855151 matthewmoggridge@quartzltd.com Consultant Editor Dr. Tim Smith PhD, CEng, MIM Production Editor Annie Baker

SALES International Sales Manager Paul Rossage paulrossage@quartzltd.com Tel: +44 (0) 1737 855116

4 News 12 USA update More calls for ‘a level playing field’ 14 Latin America update Structural steel usage in Brazil 16 China update The Yuan’s negative impact on steel 18 Japan update Japanese steel: a positive outlook 21 India update Lower profits for Indian steelmakers

Area Sales Manager Anne Considine anneconsidine@quartzltd.com Tel: +44 (0) 1737 855139 Sales Director Ken Clark kenclark@quartzltd.com Tel: +44 (0) 1737 855117

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CRU World Steel conference 45 Challenging times for European steel 48 The USA is the big winner

54 Ironmaking Magnetically treated water improves sinter plant performance

Steel Times International (USPS No: 020-958) is published monthly except Feb, May, July, Dec by Quartz Business Media Ltd and distributed in the US by DSW, 75 Aberdeen Road, Emigsville, PA 17318-0437. Periodicals postage paid at Emigsville, PA. POSTMASTER send address changes to Steel Times International c/o PO Box 437, Emigsville, PA 17318-0437.

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24 Big interview Gordon Moffat, EUROFER 29 Electric steelmaking Holistic process control for EAFs

50 Exclusive interview: worldsteel What are we without steel?

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Environment 37 Steel utility poles versus wood 42 Water treatment for Severstal

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59 Continuous casting On-line mould friction monitoring

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65 Perspectives: Can-Eng ‘Very high demand in all sectors’ ISSN 0143-7798

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68 History – The arms race April 2014

LEADER

Political correctness gone mad or misplaced ideals? There are three phrases that steel conference delegates around the world will be familiar with: ‘the elephant in the room,’ ‘a real game-changer’ and ‘a level playing field’.

Matthew Moggridge Editor matthewmoggridge@quartzltd.com

April 2014

The ‘elephant in the room’ is invariably China, the ‘game-changer’ is the role of aluminium in car manufacturing and the ‘level playing field’ often relates to European climate policy and the fact that a level playing field is necessary if European steelmakers are to remain competitive with the rest of the world. All three – China, aluminium in automotive, and European climate policy – are vitally important issues for the steel industry as a whole, but it is the latter that takes centre stage in this issue of Steel Times International. Gordon Moffat, director-general of EUROFER, a Brussels-based lobbying group representing European steelmakers, believes that the European approach to climate policy is not necessarily the right one and that a more pragmatic approach is needed. In an exclusive interview with this magazine, Moffat argues that products

produced by European steelmakers save six times as much CO2 as they produce and that, for this reason, the approach taken should not be punitive, but rather more inclusive and more collaborative. Moffat wants a climate policy that is cost-free for the most efficient producers, one that provides an incentive for less efficient steelmakers to improve their performance in terms of carbon reduction and – most importantly – one that protects the competitiveness of European industry. Right now he describes Europe’s climate policy as ineffective and damaging, but he sees a light at the end of the tunnel in the shape of the European Commission’s Steel Action Plan. The Steel Action Plan has given EUROFER a ‘foot in the door’ and has enabled Moffat to speak directly to the European Commission. “You cannot have targets without technology,” he told them, explaining how the technology doesn’t exist yet to enable steelmakers to meet EU carbon reduction targets. As Moffat put it, “We’re not the bad guys, we’re not just there to create pollution.” For the full interview, see page 24.

www.steeltimesint.com

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4 NEWS IN BRIEF SMS Group’s DRI agreement A construction licence agreement between Kobe Steel of Japan and Paul Wurth SA of Luxembourg, part of the SMS Group, means that the SMS Group will be able to design and erect MIDREX Direct Reduction plants around the world. Kobe Steel claims that the MIDREX direct reduction process is regarded as ‘the industry’s most productive technology’ for making high-quality direct reduced iron.

Laser welding partnership ArcelorMittal’s Tailored Blanks Division has teamed up with welding systems manufacturer Andritz Soutec with a view to rolling out laser welding technology globally. Usibor and Ductibor, both steels manufactured by ArcelorMittal, are claimed to be ‘advanced hot stamping products’. They possess an aluminium-silicon coating designed to protect car parts during heat treatment and against corrosion.

Steel JV plan for Mongolia Inner Mongolia Baotou Steel Union Co is planning a joint-venture steel plant with an annual production capacity of 5Mt in Mongolia. The Chinese company has been in close talks with Mongolia and if all goes to plan, the steel plant will be completed in two phases within three years. The production capacity of phase-I will be 3Mt/yr.

Nucor DRI expansion plans A US$750 million direct reduced iron (DRI) plant in St. James Parish, Mississippi, USA, might be expanded by Nucor with four additional phases taking total site investment to US$3.1 billion. The plant began producing DRI late last year and, it is claimed, is already streets ahead of its competitors, says Nucor Corporation chairman and president, John Ferriola.

Iran welcomes the Italians The Iranians claim that they welcome Italian investors interested in the country’s mining projects. Mehdi Karbasian, Iran's Deputy Minister of Industries, Mines and Trade, is reported by the Iran Daily as saying that Iran and Italy have enjoyed ‘valuable ties for more than three decades.

For more steel industry news and features, visit www.steeltimesint.com

April 2014

INDUSTRY NEWS

Congress pressed on dumping Mario Longhi, president and CEO of United States Steel Corporation (US Steel) has joined forces with Leo Gerard, international president of the United Steelworkers union, and other steel executives, to press Congress to maintain the USA’s economic and national security by halting unfair trade practices and enforcing trade laws. Mr Longhi testified before the Congressional Steel Caucus about illegal dumping of steel tubular products by South Korea and urged an end to unfair trade practices. During his testimony, Longhi emphasised that the issue of fair trade was “a matter of utmost importance to our employees, our company, our industry and our country.” US Steel has over 24,000 employees and is the USA's largest producer of tubular products headquartered in the United States. The company’s domestic position in the tubular market makes the “alarmingly rapid and intense surge of imported OCTG (Oil Country Tubular Goods) products into the market” to be of particular concern, he stated. “OCTG products are… integral

to the building and maintenance of our nation's critical infrastructure and must meet the highest safety and quality standards,” said Longhi, adding that “the evidence in this case clearly shows that OCTG products are being illegally dumped in what remains the most open and attractive market in the world at prices below fair value and in ways designed to circumvent our trade laws.” He discussed the on-going trade case that US Steel and others have brought before the US Department of Commerce, the importance of ending the illegal dumping of OCTG products and the recent zero-margin preliminary decision in the case. Noting the “dire consequences

that lie in wait for the American steel industry, and for the jobs of thousands of middle class workers,” Longhi re-emphasised the need for swift action by Washington on this trade issue by stating, “We rely on you, our government, to enforce these rules and punish the rule breakers…all we ask is for a level playing field – the one our trade laws promised we would have.” Longhi said he was disappointed that the Department of Commerce had failed to recognise and punish illegal South Korean dumping, but added that ‘the government’s meaningful investigative work is typically performed during the final phase of the case – and that phase is now underway.'

Saudis open in South Wales Structural steel specialist, Arabian International Company (AIC), part of the Attieh Group, is opening a site in Newport, South Wales, United Kingdom. The Saudi Arabian company now occupies the same site formerly used by Rowecord, the steel company that built the roof of the Olympic Aquatic Centre in London. Rowecord went into administration in April 2013 owing £24 million, making 430 people

redundant, but some of those people have been taken on by AIC. Under AIC, the plant will produce around 18kt of structural steel per annum. The company chose Wales because of the region’s supplier infrastructure and its heavy industrial heritage. According to a report by the BBC, AIC’s UK CEO, Michael Treacy, said the port will be integral to the company’s export activity. AIC's key customers are the oil and gas, refining, petrochemical,

power, smelting, steel, cement, desalination and other industrial and commercial projects.There are two main AIC divisions: structural steel and transmission/telecom towers. In addition to two plants in the Kingdom of Saudi Arabia with a combined annual capacity of 192kt, AIC has a base in the United Arab Emirates (84kt) a plant in Egypt (40kt) and an operation in China (70kt). Source: BBC.

Big steel order for ArcelorMittal One of the largest offshore oilfields in the world – the Zakum oil field in the United Arab Emirates – has purchased 5,400 tonnes of clad steel plates from the world's largest steel company, ArcelorMittal. The steel in question will be used to build new wells and processing

units that will enable Zakum Development Company (ZADCO) to increase its production capacity by 25% by 2017. Currently, the plant produces 500,000 barrels of oil per day. The steel will be used by Tectubi Raccodi and EEW who will

manufacture tubes and fittings using the steel. Germany-based EEW will use 4,342 tonnes and Tectubi Raccodi of Italy the remaining 1,101 tonnes. Deliveries from ArcelorMittal’s Le Creusot plant in France will began in April and will be completed by July. www.steeltimesint.com

INDUSTRY NEWS

Tata tests new technology A new steelmaking technology that could reduce carbon dioxide emissions by 20% when compared with the conventional ironmaking process, is being tested for the fourth time by Tata Steel. The fourth test production campaign, at the Hlsarna pilot plant at the company’s IJmuiden works in the Netherlands will begin mid-May and last about six weeks. Hlsarna is the name of the new technology. It was developed partly at the IJmuiden works and enables the direct input of coal and fine iron ore into the ironmaking furnace. Tata Steel says that the process saves energy consumption by eliminating two of the key raw materials processing stages in conventional blast furnace ironmaking, namely coking and sintering. Coking is the production of coke from coal and sintering is the agglomeration of fine iron ore. Hans Fischer, chief technical

officer of Tata Steel’s European operations and hub director of Tata Steel in IJmuiden said he was proud to have succeeded in designing and constructing this installation and to have advanced what is regarded as breakthrough technology. “During the third test campaign last year, liquid Hlsarna iron was produced in longer production runs than in previous campaigns and was used for the first time in the commercial steelmaking process,” he explained. Tata Steel is working closely with several major steel companies in the ULCOS consortium and with Rio Tinto. According to Fischer, “Despite the challenging economic circumstances in Europe, Tata Steel and its ULCOS partners have continued to support the HIsarna project. But future phases of HIsarna’s development will require

very substantial investment that will exceed what the project partners can provide by themselves. We are now looking for further support from the European Commission and the Dutch government to enable this potentially breakthrough technology to progress to the next and more advanced stage.” The fourth test campaign will aim to produce liquid iron in a series of production runs, each lasting several days. Different types of coal and iron ore will be tested and, after analysis, Tata Steel and its partners will prepare for a fifth and more prolonged campaign in 2015, which would last six months. Tata Steel said, “Should the results of this test prove positive, the next crucial step in HIsarna’s development would be the design, construction and trial operation of an industrial-size HIsarna plant.”

ArcelorMittal upgrades steel mill ArcelorMittal, the world’s largest steel company, has announced that it intends to invest US$15 million on upgrading its production lines at the Vega do Sul flat steel rolling mill in Santa Catarina, southern Brazil. The objective behind the upgrade is to equip the plant with the capability to produce Usibor, a press-hardened boron steel with an aluminium silicon coating, mainly used by the automotive industry. According to ArcelorMittal,

Usibor enables car manufacturers to make lighter, safer and more environmentally friendly vehicles at an affordable cost. The company further claims that its Usibor product has a strength of 1,500 MPa after hot stamping and says that it is ‘one of the most resistant steels used in automotive applications’. The product is used for the production of structural parts including A-pillars, B-pillars, rear bumpers, various types of rails, and the tunnel floor.

Since 2012, Usibor has been imported into Brazil from ArcelorMittal production facilities in Europe. It will be produced at Vega do Sul in Q2 of 2015. ArcelorMittal’s Tubarao plant at Espirito Santo in Brazil will continue to manufacture hot rolled coil while the patented aluminiumsilicum coating will be applied at Vega do Sul. The investment at Vega do Sul reinforces ArcelorMittal’s commitment to the automotive industry and to Brazil.

Budget boost for Tata Steel The Rt. Hon. George Osborne MP, the British Government’s Chancellor of the Exchequer, has visited Tata Steel’s Port Talbot steelworks in South Wales, UK. Mr. Osborne was welcomed by Karl Koehler, CEO of Tata Steel Europe, who made it clear that measures introduced in the recent UK Budget, were a breath of fresh air for the steel company. “The measures announced in the Budget to introduce relief against the rapidly rising costs of energy taxes, which pose a very www.steeltimesint.com

real risk to Britain’s foundation industries, are extremely welcome,” Koehler said, adding George Osborne

that the Government has listened to the concerns of 'foundation industries’ by introducing cost limits, in particular the Renewables Obligation. According to Mr Koehler, the measures announced by the Chancellor are ‘a clear and meaningful contribution to forging a more competitive and sustainable future’ for Tata's UK steelmaking sites. He added that the company will work closely with the Government to secure EU approval for the measures as fast as possible.

NEWS IN BRIEF 5 Severstal revenues up 6% Severstal’s Q4 revenue of $3.38 billion was 6% up on Q3's 3.19 billion and profits from operations were up 12.1% to $411 million compared with $347 million for Q3. EBITDA was up 12.5% at $611 million from $543 millon in Q3. “Another resilient performance” was how Alexey Mordashov, Severstal’s CEO, described his company’s Q4 2013 financial results, released today. He said that the company had made a number of structural and organisational changes to reduce costs and enhance efficiency and was delivering results 'despite the ongoing challenging conditions in global steel and steel-related commodities markets’.

Global steel doom and gloom The Indonesian Iron and Steel Industry Association (IISIA) executive director, Hidayat Trisepoetro, said on Tuesday that the global steel industry was in an alarming condition, reflected by huge losses reported by leading steel manufacturers around the world. “The losses affecting the world steel industry are the result of the global economic condition that did not improve in 2013,” he said in Jakarta on Tuesday (4 Mar. 2014), as quoted by Antaranews.

‘Internationalisation’ plan Global steel-based technology and capital goods group Voestalpine is pushing ahead with its strategy of 'internationalisation’ with the opening of its new metal forming division at a site in East London, South Africa. The plant in question produces high quality automotive components and forms part of Voestalpine Group's EUR100 million investment in South Africa – in addition to developments in China, the USA, Romania and Germany.

Steel Safety Day announced Monday 28th April 2014 has been named as Steel Safety Day by the World Steel Association (worldsteel). The objective of the day is to reiterate the organisation’s ‘commitment to the health and safety of the people who work in the steel industry’. Billed as a safety awareness day, Steel Safety Day is aligned with World Safety Day, which is held on the 28th April every year. April 2014

6 INDUSTRY NEWS

Hyundai’s new steel plant Hyundai Steel, an affiliate of Hyundai Motor Group, has announced plans to build a special steel production factory inside its Dangjin steel mill in South Chungcheong. The aim is to complete the factory by 2015 and produce 1Mt of steel during the plant's first year of operation. Special steels produced at the plant will be used by the Hyundai Motor Group's Hyundai Motor and Kia Motors companies.

SMS steelworks commissioned A steelworks supplied by SMS Siemag, has been commissioned by Fuxin Special Steel Co. The plant, at Zhangzhou in the Chinese Fujian province, will manufacture stainless steel slabs and is the first of its kind to use waste heat from the AOD converter and electric arc furnace, reducing emissions by 60kt of CO2 per year. The plant has an annual capacity of 720kt and comprises a special steel plant, a continuous slab caster and environmental facilities for gas cleaning and energy recovery. There is also a 160-tonne electric arc furnace with tapping spout, a 180-tonne AOD-L converter and a 180-tonne ladle furnace. The AOD converter is relined using a special changing car and is changed twice as quickly as conventional set-ups. Primary emissions are extracted via cooled stacks and fed to two bag filters. The EAF and AOD converter are provided with enclosures for efficient capture of dust-laden secondary emissions, claims SMS. Additional dust will be captured and extracted. Gas cleaning filter systems are designed for more than 2.3 million cubic metres of air per hour and the plant is equipped with an Ecoplants energy recovery system that utilises thermal energy from hot waste gases of more than 2,000 deg C from the EAF and AOD and produces steam, which is used to cool electrical units. April 2014

Steel recovery continues In its Short Range Outlook for 2014 and 2015, worldsteel forecasts that global apparent steel use will increase by 3.1% to 1,527 Mt in 2014. In 2015, it is forecast that world steel demand will grow further by 3.3% and will reach 1,576 Mt. Hans Jürgen Kerkhoff, chairman of worldsteel's economics committee, said: “In 2013 world steel demand grew higher than our previous forecasts due to a stronger than expected performance in the developed world in the second half of the year. In particular, the recovery in the United States gained strength. In addition, the downturn

outlook for the CIS region. Finally issues remain surrounding China’s debt and real estate bubble." The global steel demand recovery continues, but growth is stabilising at a lower rate with continued volatility and uncertainty. After growth of 6.1% in 2013, with support from government infrastructure investment, apparent steel use in China is expected to slow to 3.0% growth in 2014 (721.2Mt) as the Chinese government’s efforts to rebalance the economy restrains investment activity. In 2015, steel demand growth is expected to further decelerate to 2.7%.

in the EU bottomed out and we now expect that steel demand in the Eurozone will move into positive growth in 2014. On the other hand, many emerging economies continue to struggle with structural issues and financial market volatility. This, along with China’s deceleration, is the reason for our slightly lower global growth rate forecast for 2014. In 2015, growth in most parts of the world will accelerate thanks to a continuing steady recovery in the developed economies and an improvement in the situation for the emerging economies. But China’s steel demand will further decelerate and this will prevent the broad recovery momentum from registering a higher global growth rate for 2015." Kerkoff said the recovery in Europe was still only mild and constrained by high debt and unemployment. He said that structural problems in emerging economies are less likely to be resolved in the short-term, leaving them fragile and susceptible to external shocks. "We are still seeing unexpected unstable political situations in many emerging economies. In this regard, the development involving Crimea raises a high downside risk for our

In India, steel demand is expected to grow by 3.3% to 76.2Mt in 2014, following 1.8% growth in 2013, due to an improved outlook for the construction and manufacturing sectors, even though this will be constrained by high inflation and structural problems. Steel demand is projected to grow by 4.5% in 2015 supported by the expectation that structural reforms will be implemented. In Japan, following a 2.0% increase in 2013, due to a moderate GDP recovery as a result of “Abenomics”, apparent steel use in Japan is expected to contract by 1.0% to 64.6Mt in 2014 due to the consumption tax hike negatively affecting the construction and automotive sectors. In 2015, steel demand is expected to increase by 0.5%. In the United States, after a decrease of -0.6% in apparent steel use in 2013, years 2014-2015 are expected to deliver a return to growth and recovery. Apparent steel use will grow by 4.0% to 99.4Mt in 2014 and by 3.7% in 2015. The impact of the Federal Reserve Bank tapering programme on the US economy has been contained so far, but future actions still remain a risk.

Apparent steel use in Mexico is expected to grow by 3.4% to 19.2 Mt in 2014 and to grow further by 3.9% in 2015. In Central and South America, apparent steel use is projected to grow by 3.4% to 50.9Mt in 2014 down from 4.3% in 2013. This is forecast to slow further to 2.7% in 2015 due to contraction in Argentina and a sharp slowdown in Chile. In Brazil, steel demand growth will slow to 3.0% to 27.2Mt in 2014 and 3.2% in 2015 as high inflation and interest rates restrain economic growth. After a contraction of -0.2% in 2013, apparent steel use in the EU (28) is expected to grow by 3.1% in 2014 to 143.3Mt with help of the construction sector, which is gradually bottoming out. Underlying trends at national level will continue to differ, but it appears that Southern Europe has passed its lowest point. Apparent steel use in Germany is expected to increase by 4.5% in 2014, Italy by 2.6%, France by 1.0% and Spain by 3.0%. A steady transition to a broader and more durable recovery will result in steel demand growth of 3.0% in the EU (28) in 2015. Apparent steel use in the CIS region is projected to grow by only 1.1% reaching 59.5Mt in 2014 due to slow investment, but will grow by 3.7% in 2015 with Russian steel demand accelerating to 4.4% growth. Steel demand in Ukraine will continue to contract in 2014, but the fall will be limited to -3% to 5.4Mt due to financial assistance from the IMF. In the MENA region, steel demand is expected to grow by 6.1% to 66.7Mt in 2014 after a 0.9% increase in 2013. Growth in the region is strengthening as political uncertainties moderate. Strength in the non-oil sector in the GCC (Gulf Cooperation Council) countries is expected to stretch into 2014 and the Egyptian economy as well as the rest of the region will continue to recover. In 2015, steel demand in the region is expected to grow by 9.4%. Overall apparent steel use growth in the developed economies will be above 2% in 2014 and 2015, however the developing and emerging economies will continue to grow faster than the developed economies despite their more subdued performances. www.steeltimesint.com

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INDUSTRY NEWS 9

EUROFER piles on pressure Sixty four CEOs of European steelmakers have written an open letter to the Heads of State and Governments in the EU requesting a restoration of balance between industrial, energy and climate policies. The letter, signed by the likes of Aditya Mittal, Wolfgang Eder and Karl Kohler, CEOs of ArcelorMittal Europe, Voestalpine AG and Tata Steel respectively, urges EU leaders to restore the balance between industrial, energy and climate policies in order preserve the competitiveness of the industries, which are at the core of the European economy. “We all share the ambition to find an effective response to climate change. However, hopes for an early conclusion of a global agreement providing a level playing field have been dashed and, with the best will in the world, the likelihood of an agreement in 2015 creating a truly level playing field is remote,” the letter on EUROFER headed paper states. In the letter, EUROFER states that

Europe must ‘not again impose on itself unilateral CO2 reduction targets which no-one else follows. It further states that measures adopted in 2008 to protect the competitiveness of the EU industry were time-limited and subject to a reduction factor and called for those measures to be changed. EUROFER wants the EU ETS to be modified to allow 100% free allowances for the most efficient installations and no reduction factor up to and beyond 2020 – based on realistic benchmarks. The organisation also calls for the CO2 cost passed through in electricity prices by the power sector to be

fully offset by free allowances. Lastly, the letter calls for member states to 'fully exempt energy intensive industries from national decarbonisation surcharges, such as taxes, levies, grid levies and other costs relating to the support of low carbon generation – as long as competitors on global markets do not have to bear such costs. The letter signs off with “there are solutions for a real win-win EU energy and climate policy without damaging Europe’s manufacturing industries”. Full Gordon Moffat interview on page 24 of this issue. Gordon Moffat

Ansteel increases Aussie stake Chinese steelmaker Ansteel is upping its stake in an Australian iron ore mining project that it coowns with Gindalbie Metals. Ansteel’s current 50% stake in the project has been increased to 52% after the Chinese steelmaker converted $60 million of loans into shares to provide extra funding for the Karara mine, which is 200km

east of Geraldton in Australia’s mid-west. A further cash injection by the Chinese of US$230 million reduces Gindalbie’s stake to 38% and provides vital working capital. The Chinese move comes at a time when the Karara mine faces financial problems. Since 2012 its shares have fallen in value by 82%

and it is in debt to the tune of $2.5 billion. Ansteel’s money will alleviate the situation and take the pressure off of Gindalbie. Ansteel’s vice president, Chen Ping, has been appointed managing director of the mining project (he is currently chairman). Source: ABC News

GM’s accolade for steelmaker American car manufacturer General Motors has named ArcelorMittal as GM Supplier of the Year. The world’s largest steel company also picked up the prestigious Overdrive Award at a special ceremony in Detroit last month. The award has only been presented to 68 suppliers, all of whom have exceeded GM’s expectations in terms of being innovative, delivering quality products and services on time and www.steeltimesint.com

creating outstanding value. According to Grace Lieblein, vice president of GM’s global purchasing and supplier chain, ArcelorMittal has consistently met the car manufacturer’s business needs and supported its ‘cultural priorities’. The Overdrive Award has only four recipients worldwide. It recognises suppliers who have undertaken extraordinary initiatives that drove outstanding results for GM’s business. ArcelorMittal’s global account

manager for GM said the Supplier of the Year title and the Overdrive Award were testament to ‘the commitment from ArcelorMittal employees’. Gordon O’Neill added, “It is quite the privilege to be selected in such a competitive process, considering the scope of global suppliers that go beyond steel to include companies that supply services, parts, components, subsystems and other critical products that create today’s modern vehicle.”

US Steel cagey over Canada The future of US Steel’s Hamilton steel plant in Canada is uncertain as the American steel giant is in no mood to discuss its intentions for the plant or its future in Canada. A report on the website thespec.com states that the steel company has written to Hamilton's city council stating that it will not speak publicly about its future plans for the plant or the 2,000 jobs there that might be at stake. US Steel spokesman Trevor Harris has said that closing down the Hamilton blast furnace and negotiating a five-year labour contract at the company’s Lake Erie Works had saved the business money, but that five years of losses mean that more needs to be done. According to thespec.com, US Steel’s deal with Ottawa means it will continue to operate its Canadian plants until December 31 2015, when a special pension funding deal with the province comes to an end. “That combination has fed fears the company will walk away from its Canadian plants,” the website reported. Canada’s federal industry minister James Moore said he was keeping an eye on the situation and ensuring that US Steel sticks to commitments made in relation to the acquisition of Stelco. Hamilton City Council’s steel committee is sending Mayor Bob Bratina and Councillor Scott Duvall to US Steel in the hope that a private meeting can be set up. The city council has also set in motion plans for an economic impact study of a full closure of the former Stelco operation. The United Steelworkers Union says US Steel's refusal to talk is clearly an issue for local people and is ‘feeding a growing dread’. Bill Ferguson, president of the United Steelworkers local at the Lake Erie Works, said the union was trying to find out about the deal struck when US Steel acquired Stelco. “We’re included in that, we are the people who work in the mill and this is our future,” he told thespec.com Source: thespec.com For expansion of these stories and other news visit www.steeltimesint.com April 2014

10 DIARY OF EVENTS April 18-20 Steel Home Annual Conference International Convention Centre, Shanghai, China www.steelhome.cn/en

28-30 Eurocoke Summit Mansfield Traquair, Edinburgh, UK www.eurocokesummit.com

May 05-07 AISTech 2014 Indianapolis, USA. www.aist.org

05-07 Creep & Fracture Conference 2014 Rome, Italy. Organised by the European Creep Collaborative Committee www.eccc.c-s-m.it 15-17 Metal & Steel Cairo, Egypt. Organised by Arabian German Exhibitions www.metalsteeleg.com

June 02 - 03 Steel Markets Europe Berlin, Germany Organised by Platts Debating all that matters for today’s steel producers, traders, distributors and end users. www.platts.com 03 - 06 Metallurgy Litmash Expocentre, Moscow, Russia An international trade fair for metallurgy, machinery, plant technology and products. www.metallurgy-tube-russia.com 04 - 05 9th Asian Stainless Steel Conference Ritz Carlton, Hong Kong A conference bringing together leading players in the Asian stainless steel market. Organised by Metal Bulletin. www.metalbulletin.com 16-18 The 15th Guangzhou

International Metal & Metallurgy Exhibition Guangzhou, China Organised by Guangzhou Julang Exhibition Design Co. Ltd. www.julang.com.cn For more information on steel industry events, visit www.steeltimesint.com April 2014

INDUSTRY NEWS

Crude steel up by 0.6% World crude steel production for February 2014 increased by 0.6% when compared with figures for February 2013, claims the worldsteel Association. The February figure was 125Mt from the 65 countries reporting to worldsteel. China’s crude steel production for the month was estimated at 62.Mt. For both January and February this year, China produced 130.8Mt. January's figure has been revised upwards to 68.7Mt. Japan increased production by 1.4% over 2013 to 8.4Mt and

South Korea’s figure was up 6.2% to 5.3Mt. In the EU, Germany and Italy increased production by 4.2% and 3.6% respectively (3.6Mt and 2.2Mt) while France witnessed a decrease of -3.9% with a figure of 1.2Mt. The big winner was Spain, which increased production by 10.2% (1.2Mt). The Turkish steel industry saw a rise of 0.7% in its crude steel production (2.7Mt). Russia produced 5.3Mt of crude steel, a decrease of -3.1% when compared with the same period

last year and the Ukrainian industry’s production was down 10.7% to 2.3Mt. In the USA 6.7Mt of crude steel was produced in February 2014, down -1.7% on February 2013. Brazilian crude steel production was up 1.2% at 2.6Mt. In terms of the crude steel utilisation ratio for the 65 countries reporting to worldsteel, the figure was 77.6%, which was two percentage points lower than in February 2013 but 0.7 percentage points higher than in January 2014.

For a full country by country listing visit: www.worldsteel.org/statistics/crude-steel-production.html

Good news for Iranian steel Iran’s annual crude steel output will reach 15Mt by the end of the current Iranian calendar year (March 20), the chairman of the association of Iranian steel producers said on Monday Bahram Sobhani added that the output is projected to increase to 55Mt by the end of the country’s Fifth Five-Year Development Plan (2015).

Iran was the biggest producer of crude steel in the Middle East in 2013, according to the World Steel Association’s latest press release. Iran produced 15.4Mt of crude steel in 2013, a 6.6% rise compared to 2012. Iran’s crude steel production reached 14.89Mt in the previous Iranian calendar year, which ended on March 20.

On January 5, the Iranian deputy industry minister Mohammad-Jafar Sarqini said that Iran has liberalised exports of steel products until the end of spring in a bid to provide incentives to domestic steel producers. Sarqini told IRNA that exports of steel products and ingots will be free until the end of June. Source: Daily Tehran Times

Graphene-coated steel from Tata A partnership has been formed between Tata Steel and the Engineering and Physical Sciences Research Council (EPSRC). The objective of the venture is to develop a range of innovations including graphene-coated steels and ‘next-generation’ sensors that can operate in extreme environments. Research into the viability of coating steel strip with graphene will be one of many areas covered by the partnership. According to Tata Steel, graphene offers a high degree of electrical conductivity and has anticorrosion properties. “Graphenecoated steels could boost the energy efficiency of solar panels, or make buildings longer lasting by reducing damage caused by water or the most corrosive of chemicals,” said the company, adding that ways to improve waste recycling processes and developing

new sensor equipment capable of operating in high temperatures or extreme chemical environments are also high on the agenda. The partnership will mean that Tata Steel has access to world class experts and, therefore, will enhance the company's research and development activities. The Rt Hon Vince Cable, UK Secretary of State for Business, Innovation & Skills, and the Chief Executive of Tata Steel’s European operations, Karl Koehler were both present when the research partnership agreement was signed. Debashish Bhattacharjee, group director for R&D at Tata Steel, said that Tata's customers want the company to constantly develop new and more sophisticated products to overcome various challenges. “We also need to develop new manufacturing processes to support product development,” he said, adding

that the partnership will broaden and enhance Tata’s research capabilities and help speed up the achievement of the partnership’s objectives.”

Professor David Delpy, EPSRC chief executive, said: “Research across our portfolio has significant impacts in areas in which Tata Steel operates. The company is already investing in joint research projects with UK universities and Centres for Doctoral Training. These relationships will develop the processes and people the UK needs to perform well in the scientific and economic arena.” www.steeltimesint.com

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12 USA UPDATE

More calls for ‘a level playing field’ US steelmakers are said to be disappointed by the ‘cautious but prudent’ stand taken by the US Department of Commerce over steel dumping by South Korean suppliers. By Manik Mehta* THE US Department of Commerce took a cautious but prudent stand on cases of steel dumping by South Korean suppliers when it announced its preliminary ruling on a number of cases. The DoC’s initial ruling was particularly disappointing for US steelmakers who complain that South Korea, the largest supplier, was not penalised with any duties. Other countries, such as India, the Philippines, Saudi Arabia, Taiwan, Thailand, Turkey, Ukraine and Vietnam, were not so fortunate as their oil country tubular goods (OCTG) – these are iron and steel pipes and tubes used by the oil and gas industry – attracted import tariffs. As the largest US producer of these products, US Steel was obviously affected by such foreign supplies. The OCTG products are made from flat-rolled steel by companies, including big names such as Nucor, which could also be affected. But the DoC sent a clear message to other countries by imposing anti-dumping and countervailing duties on China’s steelpipe products. While China is viewed as the biggest offender, there are other countries that are equally culpable of selling products in the US at prices allegedly kept low through a maze of subsidies that enable them to sell their products at below-cost prices. The DoC regulators, following a petition filed by US steelmaking companies, are trying to determine whether the nine supplying countries, mostly in Asia, were engaged in unfair and illegal trade practices. The petition contends that steel-pipe producers from the nine countries were selling their products at below-market prices, giving them an unfair advantage. According to a number of sources, the US oil and gas industry was worth $33 to $34 billion at the start of 2013, and is poised to grow at an annual rate of 4.5% between 2013 and 2020. Over 1.7Mt of steel pipe were imported in 2012 for the US oil and gas industry, a doubling of the 840kt imported in 2010. Chinese suppliers have long eyed the USA’s booming oil and gas industry, which is engaged in shale exploration in a number of states. Ohio’s two senators, Democrat Sherrod Brown and Republican Rob Portman, have

led a campaign in Congress to end what they called “illegal dumping” of foreignmade products and called for creating a level-playing field. The DoC ruling, according to Brown, should make it clear to China and others that they could not use loopholes to circumvent international law and evade anti-dumping and countervailing duties. Portman said the ruling was “good news” for thousands of American workers whose jobs were threatened by Chinese products. Meanwhile, ArcelorMittal, the world’s largest steel company with 2013 production of 91.2Mt, recently announced that it had, together with Nippon Steel & Sumitomo Metal Corp, completed the acquisition of ThyssenKrupp Steel USA’s steel processing plant in Calvert, Alabama, after obtaining all the regulatory clearances. The Calvert acquisition is a 50:50 joint venture between ArcelorMittal and NSSMC, with a total capacity of 5.3Mt, including hot rolling, cold rolling, coating and finishing lines. ArcelorMittal’s chairman and CEO, Lakshmi N. Mittal, described the acquisition as an “important milestone” for his company. They hope to tap rising demand for steel in the automotive and energy markets. On another front, the growing trend among carmakers to use aluminium has alarmed steelmakers. After Ford recently announced that it would make the body of its new F-150 vehicle from aluminium, US steelmakers fear that steel could, eventually be replaced by aluminium for the body of the car; they are now offering stronger steel so as not to lose the crucially important customer base in the automobile industry.The Steel Marketing Development Institute maintained that the automobile industry, the second largest buyer of steel after the construction sector, accounts for some 20% of sales by US steelmakers.Thus, the impact of the replacement of steel by aluminium on the steel industry’s business should be obvious. To illustrate the point, some 70% of sales at Severstal’s Dearborn plant, for example, is generated by the automotive industry. The use of aluminium instead of steel, seems to be gaining momentum, particularly because automobile

manufacturers are required to comply with new fuel-economy standards by 2025. Michigan-based research company Ducker had already forecast that consumption of aluminium would double between 2008 and 2025.This also explains Severstal’s strong motivation to make advanced and lighter high-strength steel. The company’s Dearborn plant is reportedly planning to produce half a million tons more than last year’s 2.1Mt, prompted by the rise in demand created by the F-150 model.Ford says that the F-150 frame has increased the use of high-strength steel from 23% to 77%, resulting in reducing the weight by some 60 lbs. Analysts say that the material used for the F-150 is a “game changer”. Some experts view the shift from steel to aluminium as an opportunity for producers of advanced steel if they are willing to make ‘little changes’, as Jody Shaw, the automotive technical marketing manager at US Steel, has been telling journalists. However, some steel producers insist that they have the price advantage and greater flexibility, which will be welcomed by car manufacturers and mechanics repairing or fixing the car. This may be a consolation, but many steel producers see an uncertain future ahead.However, they will have to come to terms with the changing reality brought about by new federal fuel-efficiency standards that mandate a fleet-wide average of 54.5 mpg by 2025. Many experts are not convinced that aluminium is a suitable replacement for steel. They recall the challenges they faced nearly 30 years ago when plastics were on everybody’s lips until experts realised that a vehicle’s plastic body panels, while contributing to reducing the overall weight, were not strong or rigid enough to withstand accidents and other problems. Experts say that ordinary steel is more likely to lose out to advanced steels than to aluminium. After all, advanced steel materials are lighter, stronger and cheaper. Alcoa, the USA’s biggest aluminium producer, has been encouraged by the automotive industry’s willingness to consider using aluminium, and is investing huge sums at production sites in Iowa and Tennessee.

* USA correspondent April 2014

www.steeltimesint.com

14 LATIN AMERICA UPDATE Structural steel usage in the Brazilian construction industry has been growing at a steady 10% per annum, but structural steel as a material, represents less than 15% of the countryâ&#x20AC;&#x2122;s construction market. This is because the proportion of cement and rebar is much higher. The figure is also a long way from levels observed in developed nations. By Germano Mendes de Paula*

THIS relatively low figure is the rule rather than the exception where emerging nations are concerned. There are two main institutions that have been fighting against the cultural and economic barriers that prevent the enlargement of structural steel usage in Brazil: the Brazilian Association of Steel Construction (ABCEM) and the Brazilian Centre of Steel Construction (CBCA). The first, which was established in 1974, gathers organisations and professionals from the steelmills, steel structures and tiles manufacturers, and plating companies. The second, which was set up 2002, is a consortium formed by steel companies that are affiliated to the Brazilian Steel Institute (IABr). CBCA is a corporate member of the Steel Construction Institute (SCI), based in the UK. ABCEM and CBCA, together, have recently released an interesting report on structural steel in Brazil, which is the focus of this article. In its second annual version, the 2013 survey included a sample of 157 participating enterprises, whose base calculation period was the year of 2012. Manufacturers of steel structures are present in all regions of the country, but most are located in the Southeast (65% the countryâ&#x20AC;&#x2122;s industrial hub), followed by the South (15.9%), Northeast (10.2%), Central-west (7%) and North (1.9%). In 2012 the total production of structural steel of those surveyed reached 1.1Mt. As it can be observed in Fig 1, 71% of the companies are concentrated in the range of production up to 5kt/yr. An additional 20% of them fabricated between 5kt/yr and 20kt/yr. Conversely, only 9% of them operated over the 20kt/yr threshold. The nominal installed capacity totalled

Structural steel usage in Brazil

1.4Mt while idled capacity has fallen from 28% in 2011 to 24% in 2012, which tends to imply a positive effect on profitability. Where scale is concerned, the picture is similar to the production figures: 63% of the firms are concentrated in the range of rated capacity up to 5kt/yr while 27% of them own facilities between 5kt/yr and 20kt/yr. The remaining 10% have equipment to produce more than 20kt/yr. Fig 2 shows the distribution of the surveyed enterprises by work force. Small firms (up to 99 people) are equivalent to 50% of the number of enterprises, but have jointly 14% of both rated capacity and production in 2012. For medium-sized companies (100 to 499 employees), the respective figures are 41% (number of enterprises), 39% (capacity) and 38% (production). Consequently, the larger organisations (500 or more employees) are only 9% in number, but account for approximately half of the market. Taking into consideration the average annual gross revenue, it is estimated that the surveyed companies had sales of some $4.6bn in 2012. Fig 3 demonstrates that 55% of the sample had annual revenues of up to $8M, while 29% had sales between $8M and $46M. In addition, 10% of the firms generated business from $46M to $154M, and 6%, more than $154M. Regarding the markets, 2012 was as follows: a) 47.3% to large structures, such as shopping centres, distribution centres, tall buildings, large sheds and transmission

towers; b) 35.7% to heavy industrial business and special works, like steel mills, mining facilities, oil and gas plants, sugar mills and bridges; c) 12.7% to medium structures, including houses, shops, small buildings, sheds and walkways; d) 4.3% to small structures, such as stairs, shelters, roofs and canopies (Fig 4). Companies participating in the survey also reported their expectation about production growth for 2013. Of these firms, 60.5% were anticipating expansion, whereas 11.5% were expecting the same level of activity, and the remaining 28% had yet to form an opinion about it. On average, the market participants were planning a 120kt (or 11.3%) production enlargement. Outside of the ABCEM/CBCA report, it is important to highlight the indirect steel trade referred to the structural steel business. Fig 5 shows that the indirect export of steel derived from this activity declined from 98kt in 2004 to only 31kt in 2013. Meanwhile, indirect imports of steel jumped from 5kt to 267kt respectively. Moreover, the participation of the SSC were equivalent to only 0.5% of the Brazilian indirect steel imports in 2004; this ratio has risen to 4.8%. The report delivered by ABCEM/CBCA is an interesting initiative, which should be made available to other nations. It provided a better understanding of a market sector that, traditionally, is characterised by scarce information.

* Professor in economics, Federal University of UberlĂ˘ndia, Brazil. E-mail: germano@ufu.br April 2014

www.steeltimesint.com

W E

LATIN AMERICA UPDATE 15 40

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Q U A L I T Y

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30 20

4 0

<0,5

0,5-1

1-5

5-10

10-20

1 30-60

20-30

>60

Fig 1 60 50

50 40

30 20

100-499

<99 Number

Capacity

>500

Production

Fig 2

$46-$154M 10.2%

>$154M 5.7%

$8-$46M 29.3%

<$8M 54.8%

Fig 3

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16 CHINA UPDATE In recent years, the Chinese steel market has been depressed. Prices have been through many highs and lows while tough market conditions have dealt severe blows to the industry. Many steel traders and producers have been forced to shut down and this has had a huge negative impact on China’s economic growth. By Shi Lili*

ON 28 February, the yuan stayed as high as $6.18 and the devaluation of the Chinese currency was over 5000.86%, which was a new high. The sudden devaluation put the commodities market at a loss and was a heavy blow to investors who believed the Chinese currency would appreciate. While bad news for investors, it was good news for exporters of Chinese steel and it brought down the FOB price of steel products by around US$5-10 per tonne. China’s steel products exports had entered into stalemate. With demand from overseas remaining low, buyers wanted to purchase at a much lower price than Chinese exporters, keen to avoid losses, were willing to accept. The export price of Chinese hot rolled steel plate remained at the same level for seven weeks in a row. Currently, the FOB sales price of boron hot rolls is around $525 to $530 for April delivery and has stayed around at this price since January. Along with the depreciation of the Chinese yuan, more foreign buyers have shown an interest in steel products made in China. Currency depreciation dealt a heavy blow to the commodities market, but was great news for exports of steel products. Recently, Chinese producers received more orders from overseas and there are greater opportunities for importers and exporters to reach agreement on prices. But while the depreciation of Chinese currency means more international buyers, reaching a final deal is still challenging, especially with the international steel market in decline and overseas markets appearing uncompetitive. This factor also raises risks of anti-dumping cases against Chinese steel producers. Secondly, the depreciation of the yuan is advantageous to downstream users of

The Yuan’s negative impact on steel steel products and this can indirectly push up the exports of machines and household appliances. If export volumes of these products go up, it will improve the supply and demand relationship of the domestic steel market. and bring the improvement of steel market to a better direction. For example, where machinery is concerned, the depreciation of the yuan will lift competitiveness for industries whose exports are settled in US dollars and benefit export businesses while increasing importing costs of core parts, such as hydraulic pump valves and precision reducers used in robotics. China’s outflow of household appliances has stayed high and exports are expected to go up by around 8% this year. Prices of imported automobiles will rise further and those made in China will be more acceptable to Chinese consumers under such circumstances and this will push up demand for steel products. Thirdly, the depreciation of the yuan will bring down imported raw materials costs such as iron ore. Iron ore has hit rock bottom for the past eight months, in some cases declining by 12% – the lowest since July 2013. Reducing reliance on imported ore

The Chinese government has made great efforts to reduce reliance on imported iron ore and instead support the exploration of domestic mines. This strategy has brought down domestic iron ore prices. Meanwhile, the depreciation of yuan has reduced imported coal volumes, brought down prices and lessened the pressure on domestic mines. Since major commodities, including iron ore, have witnessed continuous declines since the beginning of the year, the devalued yuan might prove

disadvantageous to raw materials prices. For a long time, some imported iron ores have been used for mortgage financing to fix the low rate of US dollar financing so that it could be switched to Chinese yuan and benefit from the difference. But the ongoing depreciation of the yuan going forward will reduce demand for financial arbitrage by iron ore – or any other commodities – and this will pull prices down. House prices might suffer from the tightening up of Chinese government policies. Since the foreign capital markets focused on the appreciation of the yuan and real estate earlier, more flowed into the Chinese market. However, if the yuan depreciated and foreign capital investment in real estate shrunk or flowed back to other markets, it would be a heavy blow to the financing of real estate companies and would have a negative impact on residential construction projects – and steel demand would be affected accordingly. Yet the depreciation of the yuan might temporarily stop since it was mainly the result of Chinese Central Bank interference, the aim being to cause dual currency fluctuations and lay the foundation stone to expand the exchange rate range in future. Usually, sufficient flow in the market pushes up the price of certain commodities in the short-term, but bearing in mind financing with steel products and the ebb and flow of foreign capital, such interference will still have a certain impact on steel prices. If the yuan suffers from long-term depreciation, this will push up Chinese steel exports and alleviate over-supply on the domestic market. But if it is a short-term factor and its impact on the steel market will be limited.

* China correspondent April 2014

www.steeltimesint.com

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18 JAPAN UPDATE

Japanese steel: a positive outlook

In 2013 the Japanese economy moved forward and moved away from long-term deflation. There have been many positive signs of economic growth as conditions in the domestic market have improved, boosting production and the financial performance of the Japanese steel industry. In 2014 the Japanese integrated steel mills will spend more on capital investment to maximise production levels. By Nobuhisa Iwase*

DOMESTIC demand for steel in Japan has become relatively strong since the beginning of 2013. Towards the end of March last year, most leading companies in Japan listed on the Tokyo Stock Exchange (1st category) have been confident enough to report decent financial results for the past year. Total revenues and current profits of those Japanese companies are expected to increase by up to 30% compared to 2012 figures. Export-oriented large-scale manufacturers, such as car makers, have an optimistic view that both production and profits will increase to record levels. Toyota manufactured 10.1 million cars worldwide and its combined operational income is expected to increase to 2.3 trillion yen (US$ 22.5 billion), a 70% increase from 2012 figures. Other Japanese auto producers, such as Honda, Mazda, Fuji Heavy Industry (Subaru) and Suzuki, are also expected to earn recordhigh profits. If yen depreciation continues, their profits will further expand.

Product

2013

Change %

Pig iron

81.4

83.8

3.0

Crude steel

107.2

110.6

3.1 2.8

Hot rolled products (ordinary steel)

74.9

77.0

Long products

19.2

20.5

7.2

H-beam

3.5

4.2

17.1

Bar

9.9

10.3

4.7

Wire rod

1.8

2.1

17.5

Flat products

55.7

56.4

1.3

Plate

11.3

10.6

-6.2

Hot-rolled wide strip

43.6

45.1

3.4

Table 1 Steel production in Japan (2012 vs 2013, Mt) Source: Japan Iron and Steel Federation

Although shipbuilding activity was sluggish in 2013, due to declining orders received in past years, there are positive signs for 2014. According to the Japan Ship Exporters’ Association, total new export orders for Japanese shipbuilders placed in 2013 reached to 14.61 million gross tons (GT), an 80% increase compared to the previous year. The number of ordered ships was 362, almost twice that of 2012 and the largest after the Lehman Shock. This means that, at least in terms of volume, the Japanese shipbuilding industry pulled itself out of a hole. However, bulk carriers, which are generally low-priced due to

Construction machinery

In other manufacturing sectors, shipments of construction machinery for the domestic market increased by 23.3% in 2013, which is a good sign of growth in the near future. Product

2012

Volume (Mt)

severe competition with China and Korea, made up the majority (312 vessels) of new orders, placing financial pressure on Japanese shipbuilders. In the medium term, however, Japanese shipbuilders making technology-intensive ships expect to increase the manufacture of high valueadded LNG (liquid natural gas) carriers. There are around 360 LNG vessels on the planet, of which three Japanese ocean liner companies own almost half. While shale gas produced in the USA is scheduled to start exporting to Japan in 2017, these three companies are expected to add another 90 LNG carriers in total until 2020

Volume (US$ billion)

Unit price (US$)

2012

2013

Change %

2012

2013

Change %

2012

2013

Change %

Total Iron & Steel

42.5

43.5

2.3

47.4

42.2

-11.0

1.115

970

-13.0

Semi products

5.5

5.9

7.9

3.0

2.8

-6.6

552

478

-13.4

Ordinary steel products

27.7

28.5

2.9

24.7

22.2

-10.1

891

778

-12.6

Long products

2.5

2.8

12.1

2.3

2.2

-3.2

909

785

-13.7

23.7

24.1

1.9

19.7

17.6

-10.6

833

731

-12.3

Flat products Thick plate

3.6

3.3

-9.6

2.8

2.2

-22.8

773

660

-14.6

Hot-rolled wide strip

10.2

11.5

12.2

6.9

0.2

669

598

-10.7

Cold-rolled wide strip

3.2

-0.6

2.6

2.4

-9.8

826

749

-9.3

Galvanized coil

4.6

4.2

-8.7

4.5

3.8

-16.6

978

893

-8.7

Note: “unit prices” is calculated as “value/volume” by an author

Table 2 Japan’s steel export (2012 vs 2013) Source: Japan Iron and Steel Federation

* An independent steel economist, Karuizawa, Japan. E-mail: nobykaru@seagreen.ocn.ne.jp April 2014

www.steeltimesint.com

JAPAN UPDATE 19

by spending almost 2 trillion yen (US$ 19.6 billion). The price of an LNG carrier is estimated to be around 20 billion yen (US$ 196 million), which, on average, is almost double the price of all ships. There is some cause for concern where Japanese domestic steel demand is concerned. Consumption tax is likely to be increased in April from 5% to 8%. Accelerated demand for high-price goods

While there should be accelerated demand for high-price durable goods, such as cars, until March, some repercussions are inevitable. This is why the government, led by Shinzo Abe, Prime Minister of Japan, has constantly raised the issue of increasing wage levels in order to increase demand. Given improving domestic market conditions, Japanâ&#x20AC;&#x2122;s steel production figures in 2013 showed plenty of promise (See Table 1). Crude steel production increased to 110.6Mt, for the first time since 2008. Production of hot rolled products increased by 2.8% to 77 Mt. In fact, long products such as H-beams, bars and wire rod recorded remarkable increases, which reflected stronger domestic demand in the construction sector. On the other hand, production of flat products showed modest growth of 1.3% with a 6.2% decline in plate and a 3.4% increase in hot-rolled wide strip. The decline in plate production reflected the current stagnant shipbuilding situation in Japan. Domestic steel demand for hot-rolled wide strip was relatively strong with major manufacturing sectors recording an increase in production in 2013, while exports remained high. Export volumes

Iron and steel export volumes by Japan remained high at more than 40Mt in 2013. Total exports reached 43.5Mt, 2.3% higher than the previous year. Export volume expanded in most product segments except for flat products such as thick plate and galvanised coil (See Table 2). In US$ value terms, total iron and steel exports declined by 11%. All products recorded declines in export value mainly due to deteriorating market conditions in Asia. The calculated unit price for total iron and steel products in 2013 was US$970 per tonne, a 13% decline from the previous year. It was reported that the market price of hot rolled coil in Asia was around US$560 at the beginning of 2014, almost half the price of just before the Lehmann Shock. However, thanks to a depreciating yen, the total value of Japanese iron and steel exports increased to 4.09 trillion yen, up 8.5% from the previous year. The calculated unit price in yen also rose to ÂĽ94,100 per tonne, a 6.1% increase from 2013. The depreciation of the Yen has eased deterioration of Japanese steel exports in terms of economic performance. Market conditions in Asia, the main destination for Japanâ&#x20AC;&#x2122;s steel exports, are still difficult. The condition of the domestic market has improved for Japanese steel producers. The price of commodity steel increased by around 10% in the Japanese market between October and December 2013. As a result, Japanese integrated steel producers are expected to record good financial performances for 2013. Nippon Steel & Sumitomo Metal Corporation (NSSMC) is expected to earn an operational profit of around 340 billion yen (USD 3.3 billion) for the whole year, four times that of 2012. JFE Holdings also announced that its Q3 net profits to December 2013 increased to 76 billion yen (US$ 750 million) 3.5 times the figure for the same period in 2012. The Japanese steel sector will enjoy a total revenue increase of around 16% in 2013, a higher than average figure for Japanese industry as a whole. All major integrated steel mills in Japan expect to maintain high levels of steel production backed by a continuing strong domestic demand. Given these favourable domestic market conditions the industry will accelerate and replace and strengthen its aged production capacity and remain competitive on the global market. www.steeltimesint.com

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INDIA UPDATE 21

Lower profits for Indian steelmakers Steel growth in India suffers as manufacturing and construction nose-dive. By Sanjay Sengupta* DURING April-September, 2013 (H1 of FY’14), India’s GDP recorded growth of 4.6% over 5.3% in H1 of FY’13. The Reserve Bank of India, has projected the country’s GDP growth in FY’14 at 4.8% as against 5% achieved in the previous year. The manufacturing sector having a weightage of 75.5% in the country’s Index of Industrial Production (IIP) has posted a negative growth of 0.1% in H1 of FY’14 as compared to 0.5% in the same period of the previous year. Demand from the construction sector, which accounts for about 50% of India’s total steel consumption, has declined sharply. All these factors pulled down the growth of crude steel production, which grew by 2.52% in H1 of FY’14 compared with 5.5% for the same period of the previous year as producers cut back their output due to low market demand. Due to the poor performance of the infrastructure, manufacturing and automotive sectors, India’s consumption of finished carbon steel recorded a low growth of 2.29% in H1 of FY’14 over 5.9% for the same period of FY’13.

Type of vehicle

Production H1 of FY’14

% change Domestic % change over H1 sales H1 over H1 of FY’13 of FY’14 of FY’13

Exports H1 of FY’14

% change over H1 of FH’13

Passenger vehicles

1523654

(-) 2.30

1200792

(-) 5.15

307493

13.77

Commercial vehicles

363714

(-) 11.58

326648

(-) 15.32

35701

(-) 19.08

Three wheelers

413193

9.55

239539

(-) 4.38

177026

29.89

Two wheelers

7981827

1.46

7016971

3.51

999227

(-) 0.35

10282388

0.66

8783950

1.18

1519447

4.54

Total Source : SIAM

Unit : Number of Vehicles.

Table 1 Production, domestic sales and exports of Indian auto industry in H1 of FY’14

Production

Production in H1 of FY’14 (P)

% change over H1 of FY’13

Crude Steel

39.610

2.52

Of Which ISPs (1) Secondary (2)

12.825

6.80

26.785

0.59

Source : JPC (P) Provisional Note – 1 : ISPs are SAIL, Tata Steel, and Vizag Steel Plant. 2 : Secondary includes mini blast furnaces, Induction furnaces and EAFs

Table 2 India’s production of crude steel in H1 of FY’14 (Mt)

Products

Production for sale H1 of FY’14 (P)

% change over H1 of FY’13

Cold Pig Iron*

3.052

(-) 2.80

Of which ISPs

0.298

(-) 18.80

Secondary

2.754

(-) 0.69

Less IPT/Own Consumption

0.074

51.02

Automotive growth disappoints

Production for Sale

2.978

(-) 3.66

India’s automotive growth, which recorded healthy figures up to FY’12, nose-dived to lower levels in H1 of FY’14. India’s auto sector recorded overall low growth of 0.66% in production and 1.18% in domestic sales, but achieved a moderate growth of 4.54% in exports. Details of India’s auto sector growth in H1 of FY’14 are shown in Table I. Passenger cars, one of the three segments under passenger vehicles, has posted a domestic sale of 885,318 units in

Sponge Iron (DRI)

10.425

(-) 10.82

Of which ISPs

---

10.425

(-) 10.82

Less IPT/Own Consumption

1.335

(-) 18.70

Production for Sale

9.090

(-) 9.53

Finished Carbon Steel

42.138

5.08

Of which ISPs

10.165

13.25

Secondary

31.973

2.72

Less IPT/Own Consumption

4.039

(-) 8.83

Production for Sale

38.099

6.80

Secondary

*Surplus of steel making requirements supplied to foundries. Source: JPC

(P) = Provisional

Table 3 India’s ferrous output for sale in H1 of FY’14 (Mt)

Net sales/income from operations INR X Million Company

H1 of FY’14

H1 of FY’13

SAIL

211590.2

213039.3

Tata Steel*

191889.5

178543.9

JSPL (C)

96391.8

Maharashtra Seamless APL Appllo Tubes (C) Uttam Galva Steels

23309.5

% change

Net profit INR X Million H1 of FY’14

H1 of FY’13

% change

(-) 0.68

16310.0

12395.2

31.58

7.47

29147.8

27073.7

7.66

92873.4

3.79

9562.0

12889.3

(-) 25.81

6117.4

10016.9

(-) 38.93

477.4

1086.9

(-) 56.08

12661.3

8996.3

40.74

319.7

324.4

(-) 1.45

34967.8

(-) 33.34

120.1

214.0

(-) 43.88

*Tata Steel’s Indian operations only, exclude overseas plants. (C) = Consolidated. Note : JSPL figures under net sales are sales turnover.

Table 4 Sales and profits of some Indian steel companies in H1 of FY’14 (Rupees X Million)

*India correspondent in Kolkata www.steeltimesint.com

April 2014

22 INDIA UPDATE

H1 of FY’14 recording a decline of 4.67% over the previous year. High vehicle finance rates in the range of 10.5% to 15%, high inflation and high fuel rates impacted sales growth. Production of crude steel

India’s total production of crude steel in H1 of FY’14 was 39.61Mt, an increase of 2.52% over 38.63Mt in H1 of FY’13. Table 2 details production by sector and variance with H1 of FY’13. Ferrous sales

“Production for sale” is arrived at by deducting inter-plant transfers (IPT) and producers’ own consumption from gross production. Some 38.09Mt of finished carbon steel was available for sale in H1 of FY’14, up 6.80% over H1 of FY’13. A summary of production for sale of iron and steel materials during H1 of FY’14 is shown in Table 3. Steel trade

Imports of finished carbon steel in H1 of FY’14 were 2.463Mt, a decline of 18.52% over 3.023Mt. in H1 of FY’13. Major imports of hot-rolled Coils were 0.609Mt. and cold-rolled Sheets/Coils 0.770Mt. Exports of finished carbon steel in H1 of FY’14 were 2.272Mt, a rise of 7.27% over 2.118 Mt. in H1 of FY’13. Major exporters shifted 0.771 Mt of hot rolled coil and 0.785Mt of GP/GC sheets. India remained a net importer of finished carbon steel in H1 of FY’14. Consumption

Consumption of carbon finished steel after accounting for variations in stock and double counting rose by 2.29% in H1 of FY’14 to 34.73Mt over 33.95Mt. in H1 of FY’13. Lack of investment in the construction/infrastructure sectors resulted in a decline of 0.7% in long products consumption in H1 of FY’14 over the same period of the previous year. Poor performance in the auto sector has also brought down finished carbon steel consumption in H1 of FY’14. Financial performance

Table 4 shows that Indian steel companies posted lower profits/losses for H1 of FY’14 for the following reasons: • Non-availability of adequate quantities of iron ore, compelling steel producers to import at a higher price. • Lower net sales realisations. • High inflation. • High interest rates. • Sharp decline in demand from construction, automotive, capital goods and white goods sectors. • Continuing depreciation of the Indian rupee against US dollar. • Free Trade Agreements with Japan and Korea have increased cheaper imports, hurting the Indian Steel Industry April 2014

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24 EXCLUSIVE INTERVIEW

Europe’s misplaced ideals? Gordon Moffat, director-general of EUROFER, says that European climate policy as it stands is threatening the competitiveness of European steelmakers and turning Europe into an industrial museum. However, in an exclusive interview with Steel Times International he argues that the European Commission’s Steel Action Plan has opened up the debate. By Matthew Moggridge*

“I Have no problem with climate policy if it is an effective climate policy,” said Gordon Moffat, director-general of EUROFER, a Brussels-based lobbying group at the heart of Europe representing the interests of European steelmakers. “I think we’re all looking for an effective climate policy and I don’t believe that the European approach is necessarily the right one,” he said. Moffat’s views on European climate policy are in strong international demand. He recently topped the bill at CRU’s World Steel Conference in Prague and, no doubt, he will soon be jetting off again to discuss Europe’s ‘isolationist approach’, which he believes is ‘counter productive’ because industries in Europe – including steel – will be forced to move outside of Europe. Moffat wants a level playing field. He wants a policy that is cost-free for the most efficient producers and one that provides an incentive for less efficient steelmakers to improve their performance in terms of carbon reduction. Most importantly, he argues that climate policy should protect the competitiveness of European industry. Unfortunately, he says, it’s failing. “It’s been badly implemented and it’s badly structured, but I do believe it can be improved,” he said with a note of optimism, while acknowledging that in Europe, climate change is almost a religion and one that has been politicised. “It’s only in Europe that you see this obsession with taking strong action even if that action is, on the one hand,

ineffective, and on the other damaging,” he said, adding that there has been a failure to be open-minded enough to look at an alternative approach and to ease the policy response so that industry can continue to function properly without losing its competitiveness. Steel, argues Moffat, is part of the solution to climate change and is needed to drive the improved efficiency engines, motors, generators and turbines necessary to develop efficient, renewable types of energy. “Our biggest problem is that they are moving towards further targets without the technological base necessary in order to ensure that they can carry these industries – foundation industries like steel, aluminium and petrochemicals – on which the manufacturing value chains depend,” he explained, adding that if one goes, there will be a gradual leeching of industries in Europe and this will weaken the EU’s ability to respond constructively to climate change and to reach the objectives it is setting itself.

profitability – and it’s far worse for primary aluminium producers. However, it was the European Commission’s Steel Action Plan, he told Steel Times International, that has encouraged intense debate between the European Commission and Eurofer and has led to the development, by DG Enterprise, of a ‘tool kit’ designed to assess the effects of climate policy and regulatory activity on ‘competitivity’. While steel producers are not deserting Europe, there has been a deadening of investment. “Nobody will invest in the face of such uncertainty,” he said, because nobody knows what is going to happen in terms of climate policy beyond 2020. “Nobody knows how much further they will tighten the system,” said Moffat. “I don’t believe anybody is talking about new capacities in Europe,” he said, pointing to Voestalpine’s activity in the USA, where shale gas has been a game

An ideological approach is wrong

While not going as far as to say that EU climate policy was ‘political correctness gone mad’, Moffat said that the emotive nature of climate policy in Europe has blinded policy makers to the more pragmatic approaches needed. “Of course we produce CO2 when we produce steel, it’s inevitable, it’s part of the chemical process, but the products we produce save six times as much CO2 as we produce and that has to be taken into account,” he said, highlighting a need to look beyond tailpipe and chimney emissions and adopt a lifecycle approach for individual products. Taking an ideological approach to climate change is wrong, argues Moffat. “You cannot take what some say is a punitive approach. You should be taking a more inclusive, more collaborative, more community approach because industry is part of the community,” he said, adding that Non-Governmental Organisations (NGOs), who Moffat believes are driving the debate, are fanatical and ideological and do not have Europe’s best interests at heart. “Industry is seen as the bad guy,” he suggested. In Prague last month, Moffat told delegates at CRU’s World Steel conference that regulatory costs are seriously eating into the profits of European steel producers – taking as much as a third of

* Editor, Steel Times International April 2014

www.steeltimesint.com

EXCLUSIVE INTERVIEW

“We need a far more robust, muscular intervention when there are trade barriers on our raw materials or access to other people’s markets, but having said that, I must defend the Commissioner for Trade, because he has proposed in the modernisation of the trade defence instruments, methods to better protect European industry and to

changer, and Thyssen Krupp’s operations in Brazil. “The [steel] industry [in Europe] is not expanding. It is not developing new capacities and it’s the same for other industries in Europe,” he added. Moffat argues that European opposition to shale gas is because it is a fossil fuel. “But when your main competitor reduces energy costs to less than half of yours, you have no choice. I think the Ukraine/Russia situation has concentrated minds,” he said. According to Moffat, there has been a policy failure in Europe over the last

decade in terms of energy security. “They made a huge miscalculation in the additional cost on energy of the green policies they have adopted, particularly renewables, and they have a way to go to finding solutions for this,” he argued. The USA didn’t sign up to Kyoto but managed to reduce carbon emissions by 14%, which Moffat said was more than their Kyoto commitment would have been. “That’s just by changing their energy mix and the reason they’ve done that is they’ve moved from coal to gas. In Europe we could do the same,” he said, highlighting the stumbling block of renewables and Germany’s switch from nuclear power. “Germany’s not exactly known for its tsunamis and seismic activity, so it’s purely a political decision,” he said. “But now, when we see the problems of energy security and the soaring costs of

put European interests first.”

www.steeltimesint.com

April 2014

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27 EXCLUSIVE INTERVIEW

renewables, it’s clear that they should be re-thinking that shift.” Moffat said that subsidies for renewables in Germany had undermined the economics of gas-fired power generation. “It’s meant that coal is cheaper than gas and we have an increased use of coal in Germany, which means that emissions are going up,” he said, explaining how Germany has the most expensive energy prices in Europe largely as a result of the policy introduced. Energy prices in Europe are not likely to come down for another 10 years and Moffat believes it is something industry will have to absorb in the short-term, although he believes the only solution is shale gas. EUROFER has taken a hard stance on climate policy because it is a killer issue for the European steel industry. “We’ve made our point, underlined the problems and difficulties we have; now we have to interact and give them positive proposals in order to continue,” he said. No level playing field by 2015

As for level playing fields, Moffat believes it unlikely that agreement will be reached in Paris in 2015. “In order to have a level playing field you have to have a verifiable agreement where the level of discipline is the same worldwide, where the same obligations are placed on everybody worldwide, apart from the poorest countries. In order to have that in our case you would need to have something like the European ETS and nobody will introduce the European ETS, it’s absolutely out of the question,” he explained, arguing that other countries have learned from Europe’s mistakes. Moffat argues that the European industry needs a continuation of protection measures put in place when the Climate Change Directive was introduced in 2008. “Everyone assumed it would be quickly followed by an international agreement in Copenhagen, which would create a level playing field,” he said. “The reason we have these protection measures is because it was recognised in 2008, at the time of the climate change directive, that this was a costly policy and it could only be introduced if Europe’s industries were protected,” said Moffat. “That’s why these measures – when you look at them on paper – seem very good: 100% free allowances for the best performers, less for the less efficient so they have an incentive to improve and compensation for electricity price rises. But they have not been implemented properly, there is a significant shortfall of free allowances for our sector – for our best

performers – and in addition to implementation of the cross-sectoral adjustment factor there is a gradual reduction of free allowances up to 2020. It’s having a huge effect on the amount of free allowances that are available. They need to continue protection measures in any case until an international agreement is reached and it won’t happen in the short term,” he said. Moffat believes that Europe should be defending European industry in the same way that the Americans and Chinese support theirs, rather than simply trying to be ‘best in class’ when applying World Trade Organisation rules. “We need a far more robust, muscular intervention when there are trade barriers on our raw materials or access to other people’s markets, but having said that, I must defend the Commissioner for Trade because he has proposed in the modernisation of the trade defence instruments, methods to better protect European industry and to put European interests first,” he said. The problem with energy policy in Europe is mainly at member state level and the failure to create a single market in energy is because member states have never agreed among themselves. Why? “Because some of them have advantages that others don’t,” he said, raising the issue, perhaps, of the need for a level playing field within Europe, let alone the rest of the world. The tide is beginning to turn and Moffat believes that the Steel Action Plan has opened the door to debate. “Industrial competitiveness was never seen as a priority. There was never any attempt to balance policies. The focus was on specific policies such as climate and environment, regardless of their impact on industry. I

think now there is a clearer recognition of the need to do something in a more balanced way,” he said. The Steel Action Plan has not only given EUROFER a foot in the door, it has raised awareness of the costs of policy and the need to keep industry in Europe. It has also given EUROFER an opportunity to address the European Commission directly. No targets without technology

Moffat told them, “You cannot have targets without technology – and they saw for the first time the root of our problems.” “I think we have a chance of revisiting the way the policy has been implemented going up to 2030. What has concentrated minds is the clear recognition that we cannot do more,” he said. Moffat believes that the only way forward is to maintain 100% free allowances for the best performing steel producers and have a review mechanism in place to reflect possible advances in technology. He argues that it is possible to improve the operation of the ETS and he believes that effective compensation for electricity price rises is also needed. Moffat is optimistic for the European steel industry. He argues that things have changed fundamentally – ‘the debate is there’ – and says there has been a ‘wave of recognition’ of the importance of industry. “I think it’s important that we don’t build an industrial museum – nobody wants to live in a museum – and I think that message is coming through. Industry is the source of richness and wealth in Europe, it has been for centuries, it's a source of employment, it maintains communities and I think that reality is becoming evident to policymakers. We’re not the bad guys, we’re not just there to create pollution”.

• See page 45 for coverage of Gordon Moffat’s presentation at CRU’s World Steel conference in Prague. April 2014

www.steeltimesint.com

ELECTRIC STEELMAKING 29

Holistic process control for EAFs Most existing control solutions for electric arc furnaces (EAFs) deal only with specific sub-systems, which are individually controlled and related to time or energy. Such a low level of automation can lead to a sub-optimal use of resources such as electric power and chemical additives. While experienced operators manage the furnace, it is difficult for them to consider all the relevant factors that make liquid steelmaking profitable â&#x20AC;&#x201C; until now. Markus Dorndorf* and Daniel Tieseler** outline the latest developments in analysis and automation technologies from Siemens VAI Metals Technologies. THE need to charge materials and energy efficiently is a key driving force behind EAF developments. One of the latest innovations developed by Siemens Metals Technologies to meet this challenge is the Simetal EAF Heatopt, the core of liquid steelmaking. Taking an holistic approach makes all the difference. Control of the entire process, collection and calculation of furnace and peripheral data in real time, affords a significant opportunity to improve energy efficiency, productivity, environmental performance, and safety. The main advantage of an holistic control system over most existing systems is the reaction to current process conditions and furnace behaviour. The ability to react to permanently changing process conditions in the EAF, for example different scrap compositions and arrangements in the furnace shell from charge-to-charge, cannot be achieved by means of nondynamic set points. This represents significant progress when compared to conventional, rigid control diagrams based on time and energy. Additionally, the basis for a deeper understanding of the EAF steelmaking process and related pre- and postprocesses is the usage of the latest measurement technologies and conditionmonitoring solutions. In order to achieve maximum transparency in the EAF process, different measurement technologies and analysis tools were developed by Siemens VAI; examples being a continuous offgas analysing system (Simetal EAF Lomas), including offgas flow measurement (Simetal EAF SAM) contact-free temperature measurement (Simetal RCB Temp), foaming slag detection (via Simetal FSD), a melt down control system (Simetal CSM) coupled with electrode regulation systems and slag-free tapping support (via Simetal SlagMon) in order to distinguish between slag and liquid steel (see Fig 1). These solutions provide a detailed view of the current process as well as material and

Offgas parameters SIMETAL Lomas1/SAM2

Process diagram and calculation models Level 1/Level 2

Slag parameters SIMETAL FSD3/Slagmon4

Holistic process model

EAF

SIMETAL EAF Heatopt8 Customer/Siemens expertise

Temperature measurement SIMETAL RCB Temp5

Process core

Melt down control system SIMETAL CSM6/ECS7 Fossil energy input settings

1 Lomas (Low Maintenance gas analysing system) 2 SAM (Single Air Measurement) 3 FSD (Foaming Slag Detection) 4 Slagmon (Slag Monitoring System) 5 RCB Temp (Refining Combined Burner with temperature measurement) 6 CSM (Condition-based Scrap Melting) 7 ECS (Electrode Control System) 8 Heatopt (Holistic energy and transparency optimising)

Electric energy input settings

Furnace control set points

Output to EAF process

Fig 1 Holistic approach of Simetal EAF Heatopt

Fig 2a and b Simetal Lomas offgas probe

Fig 2a

energy flows. Further automation solutions for scrap and material handling, as well as energy recovery, complete the holistic approach. This combined with intelligent and closedloop control algorithms and Level 2 process guiding at an extraordinary high level of automation, gives the operator the possibility of handling, modifying, and optimising the entire process.

Fig 2b

The key to the next level in performance, energy balance and productivity is the high-level performance of each individual technology, the analysis and control system, and a high level of collaboration between the different systems. The entire process from scrap to liquid steel, from material handling to slag management, from furnace pressure to offgas volume and all input and output parameters are

*Head of R&D electric steelmaking, Siemens VAI Metals Technologies GmbH, Germany **Consulting product manager, electrics & automation, Siemens Industry Inc, USA www.steeltimesint.com

April 2014

ELECTRIC STEELMAKING 31

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Fig 3 Simetal EAF Chargeopt Process Circuit

Bucket take over position Fully automated charging crane Movement templates with safety corridors

PLC controlled

Laser driven bucket detection

Video supervision

Monitoring with HMI

EAF charging position

Automated EAF scrap charging

managed and balanced from a single source: Simetal EAF Heatopt; which ensures maximum efficiency, optimum energy conversion and minimum production costs. Maximum furnace performance

The Heatopt core manages the electrical and chemical power input of an EAF utilising closed-loop control (see Fig 1). It sets the transformer tap, the reactor tap and the impedance set point related to current process conditions. Continuous monitoring of the furnace offgas components, offgas flow and slag level and the distribution of slag are taken into consideration. This optimises the input of natural gas and oxygen for refining and post-combustion. Carbon and oxygen for slag management are also carefully controlled by the system. Further benefits include optimised control of greenhouse gas emissions and increased safety achieved by the detection of potentially hazardous conditions such as water leaks in the furnace. The main benefits of the process optimisation system achieved at SDI Roanoke, Virginia, USA, are a decrease in gas and oxygen consumption by approximately 15%, an average decrease in carbon consumption by 15% and a productivity increase by approximately 3.6%. This results in lower conversion costs by more than $2/ton of tapped steel. The Heatopt system, in combination with Level 2 process management, provides further set points for scrap charging, ID-fan control and the achievement of final tapping temperature and tapping stops. Fast, safe and repeatable scrap charging processes

A consequential step is the direct link with EAF pre-processes, represented, for example, by Simetal EAF Chargeopt, an automated charging control system. Minimising EAF power-off time by www.steeltimesint.com

Auxiliary crane position

Automated handling of bucket opening traverse

Fig 4 Contact-free temperature measurement integrated in RCB technology

achieving fast, safe and repeatable charging procedures in combination with optimised crane movements has been one of Siemens Metals Technologies’ key objectives. The scrap bucket on the transfer car and the position of the charging crane can be precisely localised thanks to a newly designed measurement system. The bucket is automatically hooked by the crane, lifted from the car and transferred to the furnace, where automatic scrap charging is performed. This task is directly linked to furnace control, especially roof movements, in order to achieve minimum charging time. Finally the bucket is returned to the scrap car, where it is unhooked (see Process Circuit, Fig 3). Using the “next bucket” signal from the Heatopt control system, scrap is provided and charged just in time, depending on melting progress. Fully automated procedures shorten the process of scrapcharging, increase EAF productivity and crane availability and contribute to considerably enhanced equipment and personnel safety. For this reason, the scrapyard process is closely connected to the EAF melting process. The Simetal EAF Scrapopt system, which obtains its information from the Heatopt control unit and Level2, provides the right scrap composition and scrap layer in time to enable the automated charging control system to achieve its performance figures. Contact-free temperature measurement

The melting process is supported by tools and technologies for temperature measurement, melting progress supervision, offgas analysis, water leakage detection and tapping control. Simetal RCB Temp, a new contact-free temperature measuring system (see Fig 4) is fully integrated into SMT’s Refining Combined Burner (RCB) technology. The temperature of the steel bath is measured using a specially developed non-contact system,

which negates the need for conventional temperature measurement lances that are manually inserted through the slag door into the liquid steel. Strict temperature monitoring of the steel bath by means of special control models is the basis for achieving consistent process operations and repeatable results. This system allows the exact tapping time to be predicted during furnace power-on. The benefits of this system can be summarised as follows: • Substantially increased personnel safety. • Higher furnace productivity with reduced power-off times. • Achievement of consistent process parameters for repeatable results. • Lower operating and consumable costs. • Decreased energy consumption through accurate determination of the ideal furnace tapping time. Structure-borne, sound-based control of the melting process

SonArc CSM (Condition-based Scrap Melting) is a modern control system to be used as an add-on for the Simetal electrode control system. It observes in real time the meltdown behaviour inside the furnace shell during the main melting period and adapts the electrical set points of the EAF accordingly to provide a process-oriented control of electrical power input. Condition-based scrap monitoring also determines the optimal point for charging subsequent buckets of scrap and provides real-time visualisation with the potential of showing the loss of arc shielding by scrap movements, e.g. scrap cave-in. The SonArc FSM (Foaming Slag Manager) takes care of foaming slag practice by controlling and automating carbon and oxygen injection into the furnace, thereby determining the foaming slag height and spatial distribution inside the furnace. Consequently, the SonArc FSM April 2014

32 ELECTRIC STEELMAKING

The Simetal Lomas (low maintenance gas analysing) system with its patented gassampling probe represents a sophisticated low-maintenance gas analysis system with the highest availability, safety and explosion protection. The probe has proven its reliability and sustainability in numerous installations of more than 140 BOF primary off-gas ducts worldwide. When introduced to the EAF, the probe was further improved and adapted with a strong focus on abrasion protection, tip cleaning, cooling, and thermo-mechanical stress. Another big advantage of the Simetal Lomas sampling probe is that it continuously samples the gas to be analysed at the centre of the duct. A variety of measurement tests and optical investigations have shown that gases sampled at half of the duct radius or less, are not representative of the process status. The gases at these locations are mixed with older gases caught by swivels that transport older/former offgas from the elbow’s downstream end back up to the false air inlet gap. The swivels are located radially and directly below the cooled elbow pipes, and their size and position is dependent on velocity, temperature and pressure. At some stages of the process, there is a high concentration of ambient air at the outer zone of the duct (see Fig 2) so that analysis of measurement gas there (or through these zones) will not deliver an accurate, on-time composition of the current EAF offgas. Accurate and on-time results, however, form the basis of an optimised strategy that saves energy and costs. In EAF applications, the probe is located in the offgas duct (Fig 6) and is cleaned automatically. The EAF probe comes with a special cooling feature in order to avoid condensate formation and features a purpose-built expansion device that increases durability of the probe for several years. The Lomas system offers high April 2014

vaporous state but later condenses in the gas drying part of the system is additionally measured with a mass flow sensor. A novelty strategy

While the first strategy of measuring dissociated water with an H2 analyser is a well-known approach, the second strategy of measuring vapour in the measurement gas with two completely independent sensors is a novelty. With the latter strategy the validity of summarised information output is much higher than if the output of only one sensor was used. Sensor contamination, thermal drifts or ageing effects influence the alert output much less than when only one sensor is used. A further significant safety advantage is the redundancy of the system. If one sensor fails, a second one monitors the humidity. A number of additional measurement and process parameters are considered to

Fig 5 Real time vibration observation during melting (CSM-System) and flat bath period (FSM-System)

Melting period

Flat bath period

Vibration sensor receives mainly air-borne sound

Vibration sensor receives air-borne and structure-borne sounds

Refractory

Continuous offgas analysis

accuracy in measurement and demonstrates long-term availability of more than 99%, even under the extremely hot and dust-laden gas conditions of an EAF. Minimum maintenance is required every three months and includes a check of the probe only. The system’s processing equipment is protected in an airconditioned and dust-protected analysis container, which can be located up to 30m away from the EAF elbow. Damage occurring from falling scrap, heavy maintenance work or localised overtemperature are thus kept to a minimum. The system also features self-checking logic that automatically instigates switching and cleaning steps when certain gas analysis and gas treatment parameters (e.g. gas flow, gas temperature) reach critical values. An extremely short response time of less than 15 seconds (depending on site conditions) and continuous and

Furnace wall

leads to a well distributed level of foaming slag to cover the arcs, reducing arc radiation and saving refractory wear in all parts of the furnace, enabling optimised furnace operation during the flat bath period. It starts the carbon and oxygen injection automatically. SonArc CSM and SonArc FSM (see Fig 5) are both based on the same hardware components, thus minimising installation, maintenance and spare parts costs. Both systems monitor the conditions inside the furnace by analysing their structure-borne sound emission and the secondary currents spectrum. A combination of these systems determines the factors for totally automated furnace operation from boredown to tapping.

Slag Steel bath

accurate measurement of CO, CO2, H2, O2 and CH4 make this probe an important technology in EAF operation. Maximum safety with water leakage detection

The system’s probe not only samples and analyses offgas composition very quickly, but also detects an increase in the humidity of the offgas within a short period of time. Such an increase in humidity must be observed very carefully since it can point to a water leakage in the furnace or the offgas stack. The Simetal Lomas system searches for water leaks in the EAF in three different and parallel ways: • Water dissociated into H2 and O2 in the EAF is scanned by an H2 analyser. • Water that leaves the EAF in a vaporous state is detected by a humidity sensor, which measures the relative humidity of the measurement gas (before gas treatment). • Water that leaves the EAF in a

activate the water leakage alert. The model is a learning and iterative working code that calculates water leakage alerts based on scrap condition, burned/unburned CH4, different furnace settings, gap sizes, gas flows, ambient air conditions and a few additional essential parameters. The objective of the system is to deliver a water leakage warning as quickly (probe) and reliably (redundant humidity measurement) as possible while reducing the number of ‘fail alarms’ to a minimum. The water leakage model parameters are adapted individually for each EAF. Remote and automated tapping

Minimised slag transfer is essential in order to maximise steel output and increase steel quality. Knowledge of slag conditions reduce the quantity of deoxidising and alloying agents as well as ‘rephosphorisation’ and improves steel desulphurisation. Steel analyses are far more accurate when the amount of transferred slag is reduced to a minimum, and the lifetime of the steel ladle refractory www.steeltimesint.com

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34 ELECTRIC STEELMAKING

duration, EAF angle, tapping weight, system status) are monitored on a visualisation screen (see Fig 7). A special image processing algorithm continuously evaluates and archives the generated images. In the case of slag carry-over, an alarm is generated, triggering the respective gate unit. The use of fibre-optic cables guarantees safe and steady data transmission for accurate, real-time detection of the slag. Recovery of EAF offgas energy and control of furnace suction line power Fig 6 Simetal Lomas probe (green) fitted to the EAF’s offgas elbow

can also be significantly increased. Simetal SlagMon, a thermographic slag detection system, represents an accurate method of exploring the tapping stream. Based on the various radiation emissions in the infrared range, it is easy to differentiate between steel and slag. The system includes an infrared camera, visualisation, industrial PC and an evaluation unit and provides continuous and real-time observation and visualisation of the tapping operation. The system generates an alert signal when slag is detected. This signal can be used to control the tap hole’s locking device. Depending on the site situation, it is also possible to use this measurement principle during slag dumping in order to determine steel flow and subsequently maximise output. Operating personnel monitor tapping and slag dumping operations and all significant process parameters (tapping

Fig 7 Simetal SlagMon Continuous analysis of the IR-CAM image

The direct link to EAF post-processes, such as energy recovery solutions and ID-fan control, completes the holistic approach. While taking into consideration furnace pressure and the false air measured by the Lomas system via O2 and CO2 figures, the system controls the power of the suction line. This ensures constant furnace pressure at around 10 Pa and avoids an overoxidised furnace atmosphere. This is achieved by process-related control of the ID fans or suction line flaps. The result is reduced electrical energy consumption in ID fans based on consideration of the mass inertia of the rotating fans and dead-time correction. Additionally, reduced electrode consumption resulting from an atmosphere containing carbon-monoxide can also be achieved. When considering the energy balance of an EAF, it becomes obvious that the lion's share of energy losses is related to hot offgas leaving the furnace. The application of efficient methods to recover this energy can make a major contribution towards

90 80 77MW

Furnace of reference: Tapping weight: 120t

TTT: 55 min

Fig 8 (right) Thermal emissions of a typical EAF today *Source: Siemens VAI Database

Discharged power [MM]

Scrap operated

48 MW on average

40 30

30 MW on average recoverable

20 water cooled section air cooled section emissions via canopy

10 0 21:07

21:21

21:36

21:50

Time [hh:min]

April 2014

22.04

22:19 Average emitted energy: 370 kWh/t

improving the overall energy balance in electric steelmaking. SMT has developed modular offgas energy recovery solutions (see Fig 8). Starting with the water-cooled parts, the entire offgas system, including quenching tower, forced-draft or hairpin cooler of the conventional offgas cooling system, can be replaced by a heat-recovery steam generator (HRSG). Depending on the amount of energy to be recovered, offgas temperatures as low as 200 °C after the steam generator can be used economically. Depending on available space, the HRSG can be installed inside or outside the melt shop. “Ruth’s type” steam buffer storage or a unique high-temperature molten-salt energy-storage system, ensures a constant supply of steam even during furnace charging or tapping. The steam can be used directly for many applications such as process heating, steam ejectors, district heating or seawater. Comprehensive solutions utilising steam to drive steam turbines – with outstanding efficiency – have also been developed. Depending on the size of the recovery system, up to 35 kWh of electrical energy per ton of liquid steel can be recovered with these power generation systems. A significantly reduced carbon footprint, depending on the national conversion factor per kWh, even doubles the benefit of an efficient energyrecovery system based on EAF offgas. Concluding remarks

In order to remain competitive, it is crucial for steelmakers to operate EAF plants at a high degree of energy and process efficiency. Productivity and yield, scrap quality and availability, flexibility in steel grades and environmental impact must be considered. The energy-saving potential of an EAF plant is enormous, but unfortunately it is not, in many cases, sustainably implemented due to insufficient knowledge of process status and melting progress. Additionally, most existing control solutions deal only with specific sub-systems of the EAF. Controls are separately performed for burners, electric-arc power, post-combustion and carbon management. The Simetal EAF Heatopt can provide an individually optimised platform to meet these challenges. The keys to energy savings and process efficiency can be found in scrap charging, pre-heating and melting, slag-free tapping and continuous power-on operation throughout each of the process steps. The careful integration of these technologies in an holistic solution sets a new benchmark in electric steelmaking with respect to a reduction in specific energy consumption and related emissions. The holistic solution can reduce energy consumption by 30% in a modern EAF. www.steeltimesint.com

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Stronger. Together. It’s all about brutal temperatures, high loads and grindingly slow speeds. And that’s on a good day. Yet even when everything is running well, smelting and steelmaking take determination. It’s a rough environment that spawns soaring structures, awesome spans, powerful engines. And it means working together to keep this indispensable industry running at the very edge of innovation.

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ENVIRONMENT

The American Iron and Steel Institute (AISI) estimates that approximately 185 million utility poles are in service in North America, and most of them are made from wood. When utility poles need to be replaced or a new distribution line set up, utility managers consider factors such as cost and reliability. But increasingly, they are also considering the impact of the material on the environment and reviewing their options. By Mark Thimons*

IT is a common assumption in the electric utility industry that wood poles are more beneficial to the environment than steel poles, but new scientific data suggests otherwise. The Steel Market Development Institute (SMDI), a business unit of AISI, commissioned a detailed life cycle assessment (LCA) study to compare wood and steel poles in 35 independent category indicators. The study, entitled Environmental Life Cycle Assessment of Southern Yellow Pine Wood and North American Galvanized Steel Utility Distribution Poles, was conducted by SCS Global Services, a global leader in thirdparty environmental and sustainability certification and standards development. It compared the use of treated wood poles and galvanised steel poles over a 40-year timeframe. It applied advanced LCA methods to report the full range of potential environmental impacts associated with both galvanised steel and wood, including local and regional ecological impacts. The peer-reviewed study focused on 45foot-tall, Class 2/Grade B distribution poles and included their production, installation, maintenance and disposal or recycling. The wood poles were made from Southern yellow pine grown in the southeastern region of the United States and treated with chromated copper arsenate (CCA). The steel poles were produced using North American hot-rolled steel and were hot-dip galvanised. Two different scenarios were compared â&#x20AC;&#x201C; a Business-As-Usual (BAU) scenario in which wood poles taken out of service continued to be replaced by Class

Steel utility poles versus wood 2 wood poles, and a Steel Pole Replacement (SPR) scenario in which wood poles taken out of service were replaced with galvanised steel poles. Conducted in compliance with international LCA standards (ISO-14040-series), the study is the most comprehensive environmental assessment of its kind to date, bringing a new level of transparency to the comparative performance of these two material choices. Summary

The study found that, when wood poles are replaced by galvanised steel poles (the Steel Pole Replacement scenario), there are several significant benefits, including: â&#x20AC;˘ Lower levels of greenhouse gas and aerosol emissions associated with global climate change. When

* Director, Construction Sustainability, Steel Market Development Institute, a business unit of the American Iron and Steel Institute www.steeltimesint.com

April 2014

38 ENVIRONMENT

comparing greenhouse gas and aerosol emissions, the researchers considered the entire 40-year time span. They compared the emissions of greenhouse gases and aerosols associated with the CCAtreatment and installation of wood poles and the short-rotation, even-aged forest management practices used in harvesting Southern yellow pine with the emissions from steel poles during hot-rolled coil steel production, galvanisation, zinc smelting and installation. Short-rotation, even-aged forest management practices result in losses of forest carbon storage of between 20% to 30%, equivalent to the loss of 20 to 40 tons of carbon dioxide per acre. For the steel poles, the largest contributors to global climate change were the production of steel, galvanisation and zinc smelting. When comparing these two processes over the entire 40-year time span, the accumulated greenhouse gas and aerosol emissions associated with global climate change were lower for the Steel Pole Replacement scenario. This result calls into question the assumption that treated wood products have a lower carbon footprint than steel products. • Lower terrestrial biome disturbance to forests in the southeastern United States. In the southeastern USA, the Southern yellow pine used to produce wood poles is harvested primarily from Loblolly-shortleaf and Longleaf-slash forests. Most forest management in the region incorporates even-aged forestry in “plantation” stands, where entire stands of forest are cut at one time, allowed to grow again, and then cut again on a regular cycle. In the southeastern United States in 2007, 159 million out of 200 million acres were in plantations, accounting for nearly 80% of all timberland in the region. This type of forest management results in a landscape consisting of a patchwork of forests in different age classes, significantly altering these plant communities and threatening the long-term persistence of many species in a landscape that is, on average, between 40% to 60% disturbed when compared to a mature forest. • A lower burden on critical energy resources. When steel poles replace wood poles, it results in the use of approximately one-half of the nonrenewable energy resources, requiring 300,000 fewer barrels of oil (equivalent) over a 40-year timeframe. • Reduced impacts on the habitats of many threatened and endangered species. The SCS Global Services study considered key species identified on the US Forest Service April 2014

STEEL POLES IN THE LINE – THE BENEFITS In addition to environmental advantages, there are several other benefits to using steel poles. Steel poles are cost-effective. The approximate lifetime of a steel pole is 80 years, compared with 40 years for a wood pole. When reviewing total project cost and life cycle cost, steel poles are the more cost-effective choice. Steel poles require minimal maintenance, saving pole replacement and labour costs for electric utilities. Steel poles don’t shrink, bend, bow or twist, and the hardware remains tight. Steel poles are reliable, especially when the weather isn’t. Steel poles perform well in the harshest environments, including areas that are prone to high winds and ice storms. They can stand up to fires. And when woodpeckers are looking for food, steel poles remain impervious to their best efforts. Steel poles don’t succumb to the “domino effect.” Damage to a single pole in a distribution system rarely propagates to the rest of the system. When hit by a car, steel poles deform but typically keep the lines up and the distribution network functional. Steel poles can be used indefinitely, saving end-of-life transport/disposal costs and eliminating landfill waste. At the end of its useful service life, a steel pole can be recycled indefinitely into new steel products, so it does not end up in the landfill.

For more information on the benefits of steel distribution poles and case studies of companies that have included steel poles in their distribution lines, visit http://www.smdisteel.org/Construction/Utility% 20Poles.aspx

Threatened and Endangered Species List and the International Union for the Conservation of Nature Red List of Threatened Species. In the Business-AsUsual scenario, when wood poles replaced other wood poles, almost 90 species were affected, and seven of those species experienced disturbance to terrestrial habitats.

their lifetimes are replaced with other wood poles, their disposal results in more than 590kt of waste over a 40-year timeframe, as documented in the study. The groundbreaking study, Environmental Life Cycle Assessment of Southern Yellow Pine Wood and North American Galvanized Steel Utility Distribution Poles, provides significant results that challenge common misconceptions held about the environmental benefits of steel utility distribution poles when compared with their wood counterparts. It provides data that will be useful to utility managers who are considering the long-term impacts of their material choices when replacing or updating their electric distribution systems.

• Reduced impacts associated with hazardous emissions and wastes. The CCA formulation used for wood pole treatment is made from arsenic ore that is mined primarily in China. Arsenic is known to be chronically toxic and carcinogenic at elevated levels. In the United States, old wood poles are exempted from management as a hazardous waste under the Resource Conservation and Recovery Act, although CCA-treated lumber in residential applications is considered a hazardous waste. When wood poles at the end of

The Executive Summary of the SCS Global Services study can be found at http://www.smdisteel.org/Construction/Uti lity%20Poles/Research%20Reports.aspx www.steeltimesint.com

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42 ENVIRONMENT

Russula was selected by Severstal’s long product mill in Balakovo, Russia, to supply a water treatment plant

Water treatment for Severstal mini-mill Russula supplied a complete water treatment plant for Severstal’s new generation 1Mt/yr mini-mill. The Severstal long products mill in Balakovo commissioned the plant in the autumn of 2013. It is currently undergoing water trials for the melt shop. The system is designed to treat water used in steel production and provides the mini-mill with clean, cooled process water. Fourteen steel plants are currently operating this technology worldwide. By Alba González Pazo* RUSSULA provided the engineering, mechanical and electrical equipment, construction supervision, testing and commissioning of a complete water treatment plant for Severstal’s new 1 Mt/yr state-of-the-art mini-mill, located in the Bykovo-Otrogsky Municipality of Balakovo in the Saratov region of Russia. The new mini-mill produces long products for the local construction industry. The Balakovo mill commissioned the water treatment system for the rolling mill during the autumn of 2013. The bar mill is currently in production. In the first half of 2014, the water treatment system is undergoing water trials for the melt shop circuit – EAF, ladle furnace, fume dedusting plant and the continuous casting machine. During the course of the start-up, specialists from Russula checked the quality of the installation for the water pipelines, automatic control systems and monitoring equipment. All civil work, equipment installation and assembly was supervised on-site by the chief engineer, who was sent from Russula s headquarters in Spain. The water treatment system is one of the key elements of steel production as it regulates the required water flow and pressure at all stages of the process. Its purpose is to ensure the required

chemical composition of the water, which in turn protects various pieces of equipment from overheating. The water supply system for the mini-mill is organised in a closed cycle using rain and melt water collected from the industrial site. The rain and melt water discharges into a rainwater tank after settling, which is used to recharge the system for water recycling. The system is designed to receive and transport river water to the plant and then clean and treat it with chemicals and finally cool it. It is a fully automatic process control system comprising two 700m3 water tanks. Russula provided the technological equipment required to maintain a constant water flow and pressure at all stages of steel production. Technical water intake is from the channel near Central Heat and Power Plant 4 in Balakovo. After treatment, the water is cooled by fans to ensure the required temperature, and then returned to the steel mill. Stateof-the-art ring filters with an automatic self-cleaning system ensure that high quality water returns to the process. Water treatment plant for the new 1Mt mini-mill

The water treatment system consists of

three circuits: the direct, indirect and make-up water circuits. Contact water circuit

The direct or contact water circuit for the continuous caster and rolling mill and is sized for treating a 3,205m3/hr volumetric flow rate. The scale pit removes particles with a size equal to or greater than 200 microns. The density difference between the water and the scale, makes the larger, heavier particles deposit on the bottom of the scale pit to be removed later. By contrast, the water will continue to the process via longitudinal decanters, where small particles from the scale pit are removed by entrainment. The coarse particles that fall to the bottom of the longitudinal decanters are collected by a dual function bridge scraper and are pumped to a sludge thickener tank and press plate filter press. The remaining grease and oils on the surface are swept by the upper part of the bridge scraper and guided towards the oil skimmer. Clean water then passes to the ring filters. The ring filtration system removes particles with a density greater than water that have passed through the previous processes. Finally, filtered water is pumped to the cooling towers, where it is cooled, before returning to the mini-mill.

* Sales engineer, Russula April 2014

www.steeltimesint.com

ENVIRONMENT 43

Self-cleaning filters are installed to protect heat exchangers during operations

Cooling towers

part of the water treatment process. The pumps are made of abrasion-resistant materials, mainly in the contact water circuits, where there is mill scale/sludge.

Non-contact water circuit

For the cooling system Russula included cooling towers, plate heat exchangers and ring filtration as a preventative system to retain small particles. The non-contact water circuit for the EAF, ladle furnace, continuous casting molds, re-heat furnace and rolling mill fume de-dusting plant is sized to treat a 6,470m3/h volumetric flow rate. Make-up water circuit

The make-up water circuit is sized to treat 4000m3/h of water from the River Volga and the water holding tank, which stores rainwater as well as snow during the colder seasons. Russula supplied the feed floculation chambers, lamellar decanters, ring filtration system and a water softener system for the make-up water treatment. River water, or water from the holding tank, passes through the floculation chambers where the coarsest particles are deposited on the bottom of the chambers and the finer ones pass to the lamellar decanters. In these decanters, coarse particles that have made their way through the above process and other elements are eliminated; finer particles pass through the ring filtration system, in order to create good quality water. Finally, at the final phase of the make-up water treatment process, given the hard water levels, it will go through a softener, to meet the water quality limits required in the various systems.

Valves and instrumentation

Twenty-three tons of valves, instrumentation and special sensors were supplied to control the water treatment plant. overlap between engineering disciplines was eliminated. Control system and HMI

Water treatment plant control was developed using a Siemens S7 – 400 PLC and an HMI WinCC integrated with the mill control system.

The water treatment plant was supplied under turn-key conditions, including all of the equipment and supervision of the civil works, assembly, and commissioning.

Included in the scope of supply were 10kV medium voltage switchgear and power transformers. Low voltage distribution

Russula supplied all low voltage distribution with removable panels for the circuit breakers. The motor control centres (MCCs) were provided with communication through intelligent relays using Profibus, instead of the usual control cables to connect the PLCs to the MCCs. This resulted in large project savings, minimal cabling, mounting materials and wiring time. ABB ACS800 variable frequency drives regulate contact water flow for the scale pit and longitudinal decanters for the contact and non-contact water circuits. Cables

Engineering

Assembly was streamlined using 3D technology, bringing together civil works, piping, supports and equipment. Installation time was minimised and any www.steeltimesint.com

Mechanical equipment

Russula supplied all the mechanical equipment for the water treatment plant including ring filters, decanting basins, plate heat exchangers, thickener tank, cooling towers, bridge scrapers, skimmers to remove oil and grease, filter press and metering pumps.

Switchgear and transformers

Variable frequency drives Turn-key supply scope

Russula water treatment plant pumps

Low and medium voltage cables were included in the scope of supply. Pumps

Submersible and horizontal pumps are

Construction supervision

Russula engineering specialists were on-site during the construction of the plant to monitor and supervise all equipment installation according to specification. Commissioning

In the autumn of 2013, the water treatment circuit for the bar mill was commissioned. Currently, the melt shop circuit is undergoing water trials. About Severstal

Severstal is one of the world’s leading vertically integrated steel and steel-related mining companies, with assets in Russia, the USA, Ukraine, Latvia, Poland, Italy and Liberia. Severstal is listed on the RTS and MICEX and the company’s GDRs are traded on the LSE. Severstal reported revenue of $13,312 million and EBITDA of $2,063 million in 2013. The company’s crude steel production in 2013 reached 15.7Mt. www.severstal.com Russula can www.russula.com

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April 2014

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CRU WORLD STEEL CONFERENCE 45

Challenging time for European steel CRU’s World Steel conference in Prague last month was opened by Gordon Moffat, EUROFER’s directorgeneral, who discussed the implications of the European climate policy for steelmakers in Europe. Matthew Moggridge* was there. “I THINK there is the beginning of a change in attitude to industry and industrial policy in Europe,” said Gordon Moffat, director-general of EUROFER, at CRU’s recent World Steel conference in Prague. Moffat opened the conference with a presentation on the European Commission’s steel plan and policy for the region and its implications for the European steel industry. “The view is developing among policy makers that policy must now change and that the erosion of industrial competitiveness in Europe must now be stopped,” Moffat said, adding that there has never been a focus on competitiveness and industrial interest in Europe, which, he argued, had been sidelined in favour of specific policies on the environment and climate change. Today, however, he believes there is a ‘palpable change’ in the air and that ‘you can certainly feel the shift when you’re in Brussels’. The European Commission’s Action Plan for Steel has enabled EUROFER to open the debate on policies that, up until now, have been taboo. Today, said Moffat, business and industrial competitiveness are the new buzzwords and the Action Plan for Steel has provided the momentum. The driver for change is a ‘tool kit’ put together by the European Commission’s director-general for enterprise. The ‘kit’ embodies the concepts of competitiveness proofing, fitness tests and impact assessments to ensure that the impact of all existing regulations is proportionate to the objective of the policy. This, said Moffat, was a first for the European Commission. “The Commission has also demonstrated for the first time ever the impact that regulations can have on costs,” he said, explaining how independent consultants were brought in to analyse the profitability of the European steel industry – with

striking results. “They showed clearly that, even in the best years, at least 10% of our profit margin is taken by regulatory costs,” said Moffat. “In normal years – neither boom nor bust – as much as 35% of our profitability is accounted for by regulatory costs.” In 2009, when profitability was low or non-existent, all profits were taken by regulatory costs. “The same exercise was done for the aluminium industry and the results were much more dramatic as there have been many years when the aluminium industry has simply not been profitable due to the cost of regulatory controls,” said Moffat, highlighting that regulations are driving the aluminium industry out of Europe along with many other energy-intensive industries, such as petrochemicals and cement. Moffat said that nobody was investing in steel beyond what was required for ‘normal operations’. He told delegates that he was always under the impression that EU officials assumed EUROFER was crying wolf whenever the conversation turned to the cost of policy. “This proves that we have not been crying wolf and that environmental costs, climate costs and the rest are extremely costly for the industry,” he said. Basic trade policy in Europe needs to be more robust and less academic in its defence of European industrial interests, according to Moffat. He blamed the high cost of energy in Europe on the EU’s lack of action over at least 10 years and said that such inaction had led to ‘the disastrous situation’ where Europe is now dependent upon Russian energy. Where climate policy was concerned, Moffat argued that implementation failures and the adoption of technically unachievable targets will lead to potentially crippling costs in future. He said that progress has been made thanks to the

momentum generated by the Action Plan for Steel. Where EU trade policy was concerned, Moffat said it was hard for him to put a figure on how much it has cost the steel industry, referencing the 1994 Uruguay Agreement when a ‘zero for zero’ deal was established for the main steel producing countries. Since then, he argued, there has been a reversal of policy. “Now we’re seeing a growth of countries protected by tariffs and we’ve seen a drop of about 50% of tariff-free trade on steel products worldwide,” he said. Moffat believes that an attitude problem exists in Europe with officials more concerned with the principle of free trade rather than defending core European industrial interests. As a result its main trading partners expose Europe to the consequences of the protectionist measures adopted. “Europe has neither attempted to close its markets from tariffs or non-tariff measures, nor has it attempted what you might call ‘passive protectionism’ through the promotion of European exports via tax incentives either before the crisis or thereafter,” Moffat said. Looking at the way Europe conducts trade policy compared with the rest of the world shows Europe in a bad light, according to Moffat. Europe, he said, should not be afraid to stand up for its industry. Reciprocity should be the driving force in trade. Unilateral action, when necessary, and consistent with international rules, should not be taboo, but the guiding principle should be to preserve a level playing field. “It must have at its core the principle of actively defending European industrial interests and it must be applied in a way that aggressively attacks trade barriers or restrictions by our trading partners,” he said. “We have to look after our own

* Editor, Steel Times International www.steeltimesint.com

April 2014

46 CRU WORLD STEEL CONFERENCE

interests, as do the Americans and the Chinese, rather than defend, academically, WTO rules,” argued Moffat. “The current situation where all of our competitors worldwide are operating from protective markets or have privileged access to raw materials, including scrap, and benefit from raw materials restrictions, is untenable and it must be tackled.” Coincidence or not, Moffat said that the European Commission had put up a more muscular defence where raw materials were concerned. A ‘defence modernisation initiative’ launched by the Director-General for trade, links trade restrictions and subsidisation to a more robust use of antidumping by Europe, meaning high antidumping and anti-subsidy duties could be imposed where there are trade restrictions and where trading partners subsidise their own industries. Moffat believes that the Action Plan for Steel is forcing EU officials to actively consider European industrial interests. He said that things are moving and gradually changing. Moving on to energy, Moffat told delegates that gas prices in Europe were 300% higher than in Russia, China, South America and the USA. Electricity prices were 200% higher. With both integrated steel plants and EAF operators affected, the situation is not sustainable.

April 2014

“We can’t operate an industry that is producing globally traded products where you have differentials in cost that are so horrendous,” said Moffat. With no action being taken on a European or national level and Europe dependent upon Russia, the situation needs to be addressed. Moffat argued that Europe has not found consensus from member states to create other sources of supply and hasn’t considered the dangers, which have now become evident. The effect of the ETS on energy prices needs to be analysed and industry must be exempt from the impact of high electricity prices, subsidies for renewables, green levies and network levies, Moffat demanded. “We need regulated energy markets in Europe and access to long-term contracts and we have to start looking realistically at alternative energy sources, such as shale gas. Much of this is included in the Action Plan for Steel and just requires implementation,” he said. Green policies have had the greatest impact on energy prices, especially subsidies for renewables, which have ‘completely de-stabilised the energy markets in Europe.’ “They [green policies] have destroyed the economics of gas-fired power generation and resulted in an increase of coal-based

power production, which is forcing up CO2 emissions,” said Moffat. Ironically, the US was criticised for not ratifying Kyoto and not setting up an ETS, but has reduced emissions by 14% simply by changing its fuel mix. “That’s the kind of thing we’ve got to do in Europe,” he said. Wholesale prices for electricity in Europe are the highest in the world, but unlike the rest of the world, argues Moffat, ‘we are the only ones who are idiotic enough to tax already high prices’. He said that the prices we impose increase the retail price by as much as 50%, but things are beginning to change. Last month it was proposed that targets for renewables for each member state should be eliminated and this, he said, was significant. Why? “Because the only way you can have a legal action against a member state for failing to meet the 20% target for renewables is if there is an obligation at member state level. By removing that, the Commission has effectively moved the target for the installation of renewable energies. This will also lessen the impact of subsidies, which are necessary to make renewables viable,” he said. He added that ‘it requires an 80% subsidy for many of these energy sources to be installed and for me, an alternative

www.steeltimesint.com

CRU WORLD STEEL CONFERENCE 47

energy source that requires an 80% subsidy is not real.’ While the European Commission has indicated that it will regulate ‘to hinder the development of shale gas’, Moffat views it as a ‘green light for development of this resource’ in many member states. He said that there was a movement in Brussels to try and premptively regulate shale gas and effectively stop shale gas exploration. Brussels, however, is going to allow exploration to go forward. “It’s late if you look at what’s happened in the USA, but nonetheless it’s a step forward,” Moffat said, adding that it will take ‘many years’ to bring down energy prices in Europe. People often talk about ‘elephants in the room’ and where the European steel industry is concerned, it is climate policy. Moffat said that EUROFER has taken ‘a very high profile’ with climate policy and argued that it was necessary because of its enormous impact on the sector. Moffat is calling for a regulatory framework that is business-friendly and he is demanding no more unilateral targets. “Europe is leading because nobody is following,” he said. “We need a continuation of free allowances for the best performers with no reduction factor until we have new technology and we need real compensation for the rise in

www.steeltimesint.com

energy prices.” He reminded delegates that when the climate change directive was first adopted in 2008 the expansive nature of the project was recognised and it was acknowledged that the industry would need protection, hence free allowances, and the promise of compensation for electricity price rises. The idea was to provide protection until a level playing field existed. Moffat said there was little detail on climate policy in the Action Plan for Steel, but argued that protecting the industrial competitiveness was crucial. “It is clear that even the most ardent supporters of climate action now see that changes have to be made in order to achieve the goal of protecting European industry,” he said, emphasising that emission reduction targets in the region of 80-95% can only be applied to industrial sectors in general, including steel, if those sectors have the technical means to meet those targets. “There is recognition that the system has to be adapted in order to make the ETS work and to find an acceptable solution for sectors like steel, which are limited in what more they can do,” Moffat said. He said that the Action Plan for Steel has provided a platform from which the steel industry can debate the ETS and climate policy going forward. “And if that has

happened, it is due in large part to the general movement for more support for industry, with emphasis on competitiveness and the efforts – specifically for steel – that have been led by the Commissioner for Industry. In the Q&A session, Moffat stated that shale gas in the USA had been a gamechanger and it had brought things into focus for Europe. He described Germany’s decision to close its nuclear power stations as ‘lunatic’ and that the idea they could replace nuclear power with renewables as ‘catastrophic’. Asked about carbon capture technology, Moffat said that it was not being employed anywhere in Europe and that it was ‘extremely expensive’. “If it were applied in Europe alone it would cost us probably something like 100 Euros per tonne, which would mean it would be economically unfeasible,” he said. “It’s unproven technology, not operational, uneconomic, unviable and not part of our view. I don’t see how it can happen and you have to ask the question, Why is it not happening elsewhere if it’s such a good technical solution,” he said. Moffat said that the Greens were strongly in favour of carbon capture, but against fracking, a position he described as idealogical rather than based on a technical assessment of the technology.

April 2014

48 CRU WORLD STEEL CONFERENCE

The USA is the big winner CRU’s World Steel Conference in Prague offered delegates a special workshop examining current and future steel market dynamics from a ‘winners and losers’ perspective. By Matthew Moggridge*

HUSSAIN Medhi, an applied economist with CRU, argued that South East Asian and African countries will be good demand drivers going forward, particularly Nigeria, and that India and China are expected to do fairly well as a result of urbanisation and per capita income. Where Africa is concerned, Medhi believes that the prospects are clearly good and that the ‘rest of Africa’ outside of Nigeria, will drive demographic prospects in the longer term. China has a long way to go in terms of urbanisation, according to Medhi, but the economy there is rebalancing, credit is tightening and there will be issues surrounding growth rates over the next five years. Brazil and Russia are still urbanising and are ahead of India and China in this respect, meaning there will be less growth rate potential in China over the next five years. Medhi claims that Japan, Germany and the USA are the ‘losers’ as they are heavily urbanised already and have high per capita incomes. He identified the ‘fragile five’ nations – Brazil, South Africa, India, Turkey and Indonesia – as five emerging market economies that currently account for 8% of steel demand and 12% of world GDP. Turkey and South Africa are most at risk going forward because they are dependent upon capital inflows to fund deficits. There are also worries related to short-term debt in Turkey. Generally speaking, the ‘fragile five’ have witnessed big exchange rate depreciations, exacerbated by fears of a Chinese slowdown. In currency terms, depreciation in the region of 25% to 30% will be highly impactful and not helped by domestic

factors. In all five countries, for example, general elections are approaching, there is political unrest and demonstrations in Turkey over corruption. Brazil has seen protests about Government spending and there is labour unrest in South Africa. Hussain argued that these five ‘fragile’ economies are important for the global steel industry, but there are key risks over the next five years. Exchange rate depreciations will boost inflation and the value of local currency debt will increase. Interest rates have risen as central banks have intervened to support currencies and this, argues Medhi, will raise financing costs. Finally, financial market volatility will mean volatile exchange rates and stock markets. CRU has downgraded Turkey from 5% to 2% growth for 2014. Steel demand in Turkey will be slightly weaker over the next couple of years, Medhi believes. The good news was that a repeat of the 1990s financial crisis was not expected because foreign reserves are a lot higher in all economies and there are lower levels of US dollar-denominated debt. Furthermore, flexible exchange rate mechanisms in all of the ‘fragile five’ economies mean that central banks are not intervening as they were in the 1990s. In terms of foreign exchange rates, from a steel exporting perspective, CRU forecasts that the yen will depreciate 13%, the rouble by 12%, the Ukrainian hryvna by 15%, Turkey’s lira by over 25% and the Brazilian real by 30%. Medhi argued that these economies could be viewed as ‘winners’ in terms of net benefits for large exporters. The losers, however, will be China, as the yuan is expected to appreciate 8% over the

next five years, and Korea with an appreciation rate of 3%. The Euro, claims Medhi, is expected to remain fairly strong over the next five years. Depreciating currencies in South East Asia will impact steel imports. The picture is similar in Iran, which has also seen major issues surrounding political instability, a depreciating currency and, of course, Western sanctions. The big winner, according to Medhi, will be the USA. The dollar is expected to appreciate against all major currencies and the US, as a major importer of steel, will benefit. Where inflation is concerned the story is simpler. Average inflation in India is 7% while in Brazil inflation stands at 5.5% and in Turkey it is 5.6%. Medhi said that emerging economies will suffer from high inflation, but established economies, such as Japan, Europe, the USA and Canada, will all be below 2%. He concluded by saying that the steel demand winners would be focused around South East Asia, India and Africa, explaining that while China still has plenty of potential, it will slow down as its economy rebalances – in which case it could be viewed as both a winner and a loser. The so-called ‘fragile five’ will be exposed to currency depreciations and current account fiscal deficits, but a repeat of the 1990s financial crisis is not expected. The exchange rate outlook will favour larger exporters and, where imports are concerned, South East Asia will be hit by currency depreciations. The big global winner, however, will be the USA as the dollar goes from strengthto-strength.

* Editor, Steel Times International April 2014

www.steeltimesint.com

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50 EXCLUSIVE INTERVIEW

What are we without steel?

In the third and final part of his exclusive interview with Dr. Edwin Basson, director-general of worldsteel, Matthew Moggridge* discusses carbon emissions, climate change, the environment and sustainability.

Heavy industry and the environment, now there’s a marriage made in heaven, but it all depends on your perspective. On the one hand, technology providers supplying steelmakers – companies like SMS-Siemag, Siemens Vai and Danieli, to name but three – have pushed the envelope in terms of developing production systems that are designed to reduce carbon emissions. On the other, there are clearly worries, certainly in Europe, where European steelmakers are making their feelings known about EU climate policy and its adverse effect on industrial competitiveness going forward. Dr. Edwin Basson, director-general of worldsteel, says that ‘environmental sensitivity’ is a global phenomenon. “I don’t think there’s a place in the world where the broad concept of being green doesn’t exist,” he said. “There is a growing realisation that carbon is important, but it’s probably not the only thing that we need to focus on.”

According to Dr. Basson, carbon emissions have been behind most of the lurid headlines concerning the environment. “I think the realisation is yes, carbon emissions are important, but there are other things: water is becoming increasingly important, air cleanliness too, and many of these things have nothing to do with carbon emissions,” he said, adding dust and particle emissions to the mix. That said he realises that Government attention has focused largely on carbon emissions ‘for the moment’ partly because it’s a measurable handle on which to assess progress and a good indicator of what happens to other emissions. “If we were able to get a level playing field it would be very nice. Sadly, I don’t personally believe it will be very soon, even if there is willingness from governments around the world to put a price on carbon, the approaches are vastly different,” he said. He alluded to vastly differing carbon trading schemes in

different parts of the world and carbon taxes elsewhere. “There are carbon taxes that are specifically linked in to mitigation systems where the taxes are legally committed to mitigation; and elsewhere there are taxes that are not committed to mitigation and can go into the normal tax pool,” Basson explained.

What is the likelihood of a stable and constant supply of energy - be it electrical, natural gas or anything else?

* Editor, Steel Times International April 2014

www.steeltimesint.com

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52 EXCLUSIVE INTERVIEW

Basson believes that, in an ideal world, the best approach would be a fully international, tradable system, which can then, through market-related impacts, find a level of carbon emissions. “But how do you treat not only industries of the same type in different parts of the world the same, but also different industries in one region on a level playing field? We will not be getting to a level playing field in the near future,” he said. A level playing field

Is the lack of a level playing field good or bad? “I think that, probably, the most we can say is it’s inconvenient. None of the other resources that we use – our raw materials, our manpower and interest rates for capital investment – are the same around the world. Maybe we’re buying the same raw materials, but the transportation costs are different, the handling costs are different at a local level, labour is different in terms of productivity and in terms of training and endurance. So this becomes one of the other ‘uniquenesses’ that we need to understand around the world,” Basson said. He argues that carbon leakage is likely to become an empty term as the 10 largest steelmakers around the world are, to a greater or lesser degree, already involved in carbon mitigation systems. “So, in a way, you could say it is a level playing field in the sense that everybody is at least paying some price for carbon. In another sense it’s not level because prices differ from one region to another – that’s life,” he said. The term ‘carbon leakage’ was born when Europe was investigating ways of putting a price on carbon. “Eventually they did so by having a tradable instrument called the ETS. In the debate around what would be the impact if you started pricing carbon in Europe, but not elsewhere, the term ‘carbon leakage’ was born,” said Basson. The argument is simple: if you start charging for carbon in Europe, but not in, say, India, then it’s quite likely that producers will relocate from Europe (where they pay to emit carbon) to a place where they don’t have to pay – and in that way Europe ends up having the weakest or the worst of both worlds. “They lose production capacity with the accompanying loss of employment and because of this, capacity relocates to another place where they still pump carbon into the atmosphere and this is seen as ‘carbon leakage’. In other words, as a result of a carbon focus – or an excess of focus on carbon – businesses are forced to relocate, which means you find leakage as a result of the carbon, but the carbon emissions continue,” he said. In many ways this is the ‘green dilemma’ facing the global steel industry today and April 2014

for Basson the big question is: what is the likelihood of a stable and constant supply of energy – be it electrical, natural gas or anything else? “Clearly, all energy relates to carbon emissions,” he said, adding that, according to the World Energy Association, around 46% of all carbon emissions are linked directly to energy production – and a big part of that sits in the developed world.” Another big question is: what is going to happen to future energy supply? If you want to develop a business in Europe where you have guarantees of long-term supplies of energy, argues Basson, then Europe is still a good place to be a producer of steel – particularly where higher grades of steel are concerned (for aerospace, some parts of automotive and shipbuilding, machinery and so on). “If you don’t have access to a stable supply of energy then most likely you will have to consider a production process for steel that generates its own energy,” said Basson, explaining how the blast furnace does this best because ‘chucking the carbon into the blast furnace by way of coking coal really becomes the energy source for the reduction of iron oxides into iron’. “This is why we find that the first choice of steel making capacity tends to be the blast furnace because there is not enough electrical energy available at one level, and secondly there is most likely not available scrap in sufficient proximity to the new facility to be able to use an electric arc furnace,” said Basson. Sufficient energy supply

The question for European steelmakers in future, says Basson, is not whether Europe is a good location to put a new facility, but can we get a sufficient energy supply and can we sell our product into applications that have sufficient premium in terms of sale price, that allow us to carry the extra cost in carbon for energy use for steelmaking? Such an argument implies that electric steelmaking is less viable in Europe than BOF. Basson argues that the latter is probably ‘more viable’ stating that where the former is concerned, a relatively constant availability of scrap and a wellestablished energy supply network is required – both of which Europe offers. “But it’s reaching the end of its lifecycle,” he said, pointing to nuclear power’s unpopularity and the fact that while coal is unpopular from a carbon perspective, it is far from reaching the end of the road. Wind power is popular but unreliable and solar energy is not really an option. Energy, in other words, is a key determinant when considering the development of a new steel plant in Europe and, as such, would go against

Another big question is: what is going to happen to future energy supply? electric steelmaking. “Against the BOF will be that, most likely, you won’t get the environmental licensing,” he said, arguing that more existing BOF operations will be refurbished to comply with licensing regulations and will be larger, more ‘state-of-the-art’ and, therefore, more efficient. Environmental indicators

A set of eight environmental indicators measuring the performance of the global steel industry in close collaboration with 90 participating steelmakers have been established by worldsteel. Four of the indicators relate to production sustainability, two to the environment and two to social sustainability. Basson says that safety and health indicators have consistently improved above and beyond the others and attributes their success to the emphasis placed on them by worldsteel and its member companies. “We are now at the point where general safety performance has improved substantially and is now in the same target range of many of our competitor commodities,” he said, citing aluminium and oil. There were also vast improvements in energy usage and carbon emissions. “Internally our target is to continue to work with those that are not performing so well so that we can drive them into a better performance environment,” he said, adding that there has been an overall decline in carbon emissions and energy usage, but that a lot of work still needs to be done. “A sustainable steel industry requires a number of things. Firstly that the industry is viable and sustainable on an economic basis; so many of the things that we work on are part of that process,” he said, explaining how much of worldsteel’s work in this respect is concerned with social sustainability and safety issues, but also training. “We found a number of years back that universities stopped providing training in metallurgy as a science: it has become part of ‘metal sciences’ and our members are saying this is not good enough because they can’t find good engineers to run their blast furnaces. As a result of this we have developed an e-learning programme, which is available to most universities around the world and is being used to train our engineers of the future,” he said. Basson believes that the overall sustainability of the steel industry is vital for the maintenance of modern society as without steel so many things that people take for granted are not possible. www.steeltimesint.com

54 IRONMAKING

Magnetically treated water improves sinter plant performance When water is passed through a strong magnetic field, magnetic forces align the water molecules by polarisation and reduce surface tension. This concept was used at Rourkela Steel Plant where it improved the balling index of the green charge by 12.85%. By M K Singh*, S K Mohanty**, M Roy*, A K Sahu* and V R Deshmukh* IN the sintering process iron ore fines are mixed thoroughly with flux fines, coke breeze and other metallurgical waste produced in an integrated steel plant. Water is added to agglomerate the mix into balls in a rotating drum. These green balls are then fed to the travelling grate of the sinter plant to form a bed. After the feed material is introduced to the bed, combustion is started from the top of the bed by an ignition burner and air is sucked through the bed by means of a down draft suction fan. The combustion front propagates downward by burning the coke fines present in the charge mix and sintering commences. The prepared sinter cake is cooled, crushed and screened. The 5mm to 40mm size fraction is charged to the blast furnace along with other burden materials. The Rourkela Steel Plant

The Rourkela Steel Plantâ&#x20AC;&#x2122;s (RSP) sinter plant ll is equipped with a rotating mixing and balling drum (MBD) where, during stage one of the process, charge materials are thoroughly blended. In stage two, balling takes place in the presence of water droplets in a rotating drum. During the balling operation, water acts as a binder for fine particles. The amount of water and its distribution between the particles plays a critical role in determining the void fraction and permeability of the sinter bed. When the top layer of the bed is ignited, part of the heat generated due to ignition of the top layer is consumed in evaporating the moisture present in the lower layers. Thus any possible reduction in specific moisture content in the charge mix, without compromising on the balling property, will lead to a reduction in coke fines consumption. Exhaustive research[1] has been conducted to reduce specific water consumption without compromising the balling properties and the strength of the green balls. Lowering the surface tension of the water was identified as one means of reducing the water requirement and hence

A Siemens sinter plant at Dragon Steel Corporation, Taiwan

solid fuel consumption. Magnetic treatment of the water achieves this objective. Magnetic treatment of water

Earlier research [2],[3] has revealed that the properties of water are radically changed if it is subjected to a magnetic field. Surface tension is the main and critical factor controlling water dispersion and better dispersion can be achieved by reducing surface tension. Improving water dispersion between the particle fines can reduce the specific water consumption in the sinter mix.

Hydrogen bonds

A water molecule is formed of two hydrogen (H) atoms and one oxygen (O) atom bound by a covalent bond. Preferential sharing of covalent electron pairs towards the O atom is the result of high electro-negavity differences between O and H atoms. This causes the H2O molecule to be dipolar. The slightly negative O atom in adjacent H2O molecules forms a weak bond with the slightly positive H atoms (known as the Hydrogen bond) which has a bond energy of 29kJ per mol. Normally, every water molecule can form hydrogen bonds with up to four adjacent water molecules (two

Covalent bond

Hydrogen bond

Covalent bonds H

Fig 1 Hydrogen bonding within water molecules

Fig 2 Water molecules subjected to a strong magnetic field

*Research and Development Centre for Iron & Steel (RDCIS), Steel Authority of India Ltd (SAIL), Ranchi -834002, India e-mail: mithilesh38@sail-rdcis.com **Rourkela Steel Plant (RSP), Steel Authority of India Ltd (SAIL), Rourkela -769002, India April 2014

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Marketing & Technology Specialist (BOF) Vesuvius Advanced Refractories Europe 3BPRSFRPÐFPÐ>ÐDIL?>IÐIB>ABOÐFKÐJBQ>IÐÅLTÐBKDFKBBOFKD ÐMOLSFAFKDÐ>Ð full range of engineering services and solutions to its customers TLOIATFAB ÐMOFK@FM>IIVÐPBOSFKDÐQEBÐPQBBIÐ>KAÐCLRKAOVÐFKARPQOFBP Ð 4BÐE>SBÐ>Ð?O>KAÐKBTÐ*>OHBQFKDÐ>KAÐ1B@EKLILDVÐ * 1 Ð0MB@F>IFPQÐ OLIBÐ TEF@EÐ OBNRFOBPÐ PLJBLKBÐ TFQEÐ BUQBKPFSBÐ BUMBOFBK@BÐ TFQEFKÐ >PF@Ð,UVDBKÐ#ROK>@BÐ ,# Ð,MBO>QFLKP Ð"IB@QOF@Ð O@Ð#ROK>@BÐ " # ÐÐ BUMBOFBK@BÐTLRIAÐ>IPLÐ?BÐ>ÐABÄKFQBÐ>AS>KQ>DB ÐÐ/BMLOQFKDÐQLÐQEBÐ * 1Ð*>K>DBOÐ 0QBBI Ð AS>K@BAÐ/BCO>@QLOFBP Ð"ROLMB ÐQEBÐPR@@BPPCRIÐ @>KAFA>QBÐ TFIIÐ ?BÐ OBNRFOBAÐ QLÐ ABSBILMÐ J>OHBQFKDÐ PQO>QBDFBPÐ >KAÐ >@QFLKÐMI>KPÐQLÐ@LKQOF?RQB ÐFKÅRBK@BÐ>KAÐPRMMLOQÐQEBÐDOLTQEÐLCÐLROÐ "ROLMB>KÐ ,#Ð?RPFKBPP ÐÐ 1LÐPR@@BBAÐFKÐQEFPÐOLIB ÐVLRÐTFIIÐKBBAÐQLÐ?BÐMOBM>OBAÐQLÐQO>SBIÐLKÐ >Ð OBDRI>OÐ ?>PFP Ð E>SBÐ BUQBKPFSBÐ BUMBOFBK@BÐ TLOHFKDÐ TFQEFKÐ ,#Ð LMBO>QFLKPÐ >KAÐ J>FKQBK>K@BÐ QB@EKFNRBP Ð LOÐ >IQBOK>QFSBIVÐ E>SBÐ >KÐ FKQFJ>QBÐHKLTIBADBÐLCÐ ,#ÐPQBBIÐJ>HFKDÐLMBO>QFLKPÐCOLJÐCROK>@BÐ ÅRUÐ ?>@HDOLRKAÐ LOÐ IFKFKDPÐ PRMMIFBOÐ ?>@HDOLRKA Ð Ð &KÐ >AAFQFLKÐ VLRÐ TFIIÐ KBBAÐ QLÐ ?BÐ PBICÐ JLQFS>QBA Ð E>SBÐ PQOLKDÐ FKÅRBK@FKDÐ PHFIIPÐ >KAÐ ABJLKPQO>QBÐ QEBÐ >?FIFQVÐ QLÐ ?RFIAÐ OBI>QFLKPEFMPÐ >QÐ >IIÐ IBSBIPÐ TFQEFKÐ QEBÐ?RPFKBPP &CÐ VLRÐ TLRIAÐ IFHBÐ QLÐ ?BÐ @LKPFABOBAÐ CLOÐ QEFPÐ BU@FQFKDÐ KBTÐ MLPFQFLK Ð MIB>PBÐPBKAÐ>Ð@LMVÐLCÐVLROÐ 3 ÐQLDBQEBOÐTFQEÐ>ÐKLQBÐLCÐVLROÐP>I>OVÐ BUMB@Q>QFLKP ÐQLÐEB>QEBO ERDEBP SBPRSFRP @LJ

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LASER MEASUREMENT SYSTEMS ■ Proﬁle

Straightness ■ Diameter ■ Ovality ■ Tube End Inspection ■

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Visit us at Tube in Duesseldorf, Hall 7A Booth B13

56 IRONMAKING

Tube for air blowing

Magnetic water conditioner Process water Ore Flux Coke

Mixing & balling drum

Stop cork Capillary tube

Raw mix & bunker

Test tube Ignition furnace Water inside capillary

Sinter bed

Water outside capillary Pallet Stand

Before magnetic treatment

Fig 4 Laboratory set-up for measuring surface tension of water 1.7 1.6

After magnetic treatment

1.5

30 Balling index

Height raised in the capillary tube (mm)

Fig 3 Schematic representation of the magnetic water treatment facility in SP-II

25 20 15 10

1.4 1.3 1.2 Before innovation After innovation

1.1

0 2

Sample nos

3 Sample nos

Fig 5 Height of water column raised in the capillary tube

Fig 6 Effect of magnetic water treatment on balling index

through lone pairs and two through its two H atoms), as shown in Fig 1. When water is passed through a strong magnetic field, the water molecules rearrange in one direction as shown in Fig 2. This rearrangement causes a decrease in the covalent bond angle, leading to a decrease in the degree of consolidation between water molecules and an increase in the size of the molecule. This results in a decrease in surface tension of the water after passing through a strong magnetic field. Magnetic water conditioner

A magnetic water conditioner was designed and manufactured to match the size of the existing water supply line to the mixing and balling drum (MBD). This was targeted to reduce the surface tension of the water by at least 10%. The conditioner was installed in May 2012. A schematic of the magnetic water treatment facility is shown in Fig 3. Industrial trials were conducted before and after installation of the magnetic water conditioner. Reduction in surface tension

The surface tension of a liquid is calculated by the following formula (capillary method [4]): April 2014

Γ=

ρxgdxh

4 cos Where, Γ = Surface tension of the liquid ρ = Density of the liquid g = Acceleration due to gravity d = Inner diameter of the capillary tube h = Height of liquid raised in the capillary tube = Angle of contact between liquid and capillary wall.

The equation shows that the surface tension of a liquid is directly proportional to the liquid height raised in the capillary tube keeping all other parameters constant. This principle was used to measure the reduction in surface tension of water after magnetic treatment. Water samples were collected from the water line to the MBD before and after the location of the magnetic water conditioner. Measurements were made using a capillary tube with an inner diameter of 1mm and a measuring cylinder (Fig 4). 50ml of the water sample was poured into the measuring cylinder and sealed by a stopper through which the capillary tube passed. The height that the water sample was raised in the capillary was recorded. Tests

were repeated for untreated water and for magnetically treated water and the results presented in Fig 5. The reduction in surface tension of the water following treatment averaged 13.78%. Effect of treatment on balling index

After magnetic treatment, water molecules disperse more effectively within the fine sinter charge mix. This promotes better coagulation of the green charge, which in turn improves the balling index of the balls formed. Sinter charge mix samples were collected before and after the MBD from the conveyor belt prior to installation of magnetic water conditioner and a size analysis performed by screening. The Balling Index was calculated using the following formula: % of (+) 3mm after balling Balling Index = % of (+) 3mm before balling

Similar tests were performed after the installation of a magnetic water conditioner. The results of the balling index before and after installation of magnetic water conditioner are shown in Fig 6. It is evident that the use of magnetically treated water improves the balling index by an average of 12.85% (from 1.40 to 1.58). www.steeltimesint.com

58 IRONMAKING 0.45

Air filtration velocity (m/s)

0.40

Acknowledgement

Before innovation After innovation

0.35 0.30

Fig 7 Air filtration velocity at the top of sinter bed

0.25 0.20 0.15 0.10 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Wind box nos

Effect of treatment on air velocity

The improved balling index and strength of the green balls led to fewer fines being generated during transport to and charging to the sinter bed. This in turn improves the permeability of the packed bed and hence increases the air filtration velocity across the bed. Air filtration velocities were measured on top of the bed using a diverging hood and vane type anemometer before and after installation of the magnetic water conditioner. The measurements were made near the side plates and in the middle of the bed above each wind box from boxes 10 to 23. A comparative plot is shown in Fig 7. The

April 2014

use of magnetically treated water improved the average air filtration velocity by 20% (from 0.25 to 0.30m/s). Reduced water usage

Less water was required in the mix to achieve balling. An experimental study established approximately a 2% reduction in the specific moisture content of the green balls. This led to a reduction in coke breeze consumption of approximately 1% from 65.75kg/t to 65.11kg/t of sinter on a dry basis. Furthermore, the yield of sinter also improved by 1.55% through a reduction in the -5mm size fraction from 18.19% to 16.64%.

The authors are grateful to the management of RDCIS and RSP, SAIL for providing the opportunity and giving consistent support during the design, commissioning and successful implementation of the magnetic water conditioner at SP-II, RSP. The authors also wish to thank all those who have directly or indirectly helped in this developmental work. References

1 Effect of sintering with water subjected to magnetic field, V A Martynenko and G I Rudovski, Southern ore dressing combine, translated from Metallurg, No 5, pp 3-4, July, 1967. 2 Magnetic water treatment de-mystified, Dr Klaus J Kronenberg, Claremont, Ca., Magnets www.moreplant.com/research/files/MagneticWater-Demystified.pdf 3 On reduction in the surface tension of water due to magnetic treatment, M Amiri, Ali A Dadkhan, chemical engineering dept, Isfahan University of Technology, Isfahan, Iran, www.sciencedirect.com 4 Measuring surface tension,

www.Scienceâ&#x20AC;&#x201C;Projects.com

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CONTINUOUS CASTING 59

Thyssenkrupp

On-line mould friction monitoring Present caster operating practices are generally aimed at improving caster productivity by enhancing casting speed. Although higher casting speed increases caster productivity, it reduces mould powder consumption and thereby hinders mould-strand lubrication[1]. Reduction in mould lubrication increases mould-strand sticking and results in a higher percentage of break-outs, which impacts on machine availability, operational safety and caster productivity. By K Patwari*, N Pradhan* & N Banerjee*

The mould is the core component of a continuous caster for primary cooling and initial shell forming of liquid steel. There is a complex interaction of thermomechanical behaviours between mould and strand. The states of heat transfer, solidification, friction and lubrication determine the mould working conditions, strand surface quality and production capacity of the continuous caster. At present, the key mould monitoring technique is on-line detection of thermomechanical behaviours, the aim of which is to understand the status of friction, lubrication and heat transfer between mould and strand immediately, in order to improve strand productivity and quality. One of the essential requirements for

higher caster productivity is high-speed casting. However, high-speed casting leads to lower mould powder consumption and Sintered layer Green powder

Liquid friction

Steel

Solid friction

Shell

Fig 1 Mould powder layers during casting

0.6

enhanced mould friction, which enhance cracking, mould sticking and break-outs. It is necessary, therefore, to improve powder consumption and reduce mould friction to avoid shell sticking at higher casting speeds. In this context, mould oscillation parameters and mould powder characteristics play a very important role in improving mould lubrication. In the present study, the friction of the mould was measured on-line by a Mould Oscillation Monitoring System (MOMS) and calculated theoretically using mould oscillation parameters and mould powder properties at various casting speeds. Mould powder consumption was monitored for various types of powders. The deficiency of mould lubrication in

200

Exit. OSC. f:Vc x 100 (5% al2o3 pick-up) powder B Exit. OSC. f:Vc x 100 (5% al2o3 pick-up) powder A

0.5 Frequency = 90 x casting speed 0.4 Frequency = 100 x casting speed 0.3

Friction, gm/cm2

Consumption, kg/m2

Frequency = 80 x casting speed 150

OSC. f:Vc x 80 (5% al2o3 pick-up) powder B

100

OSC. f:Vc x 80 (5% al2o3 pick-up) powder A OSC. f:Vc x 100 (5% al2o3 pick-up) powder A

0.2 0.7

0.9

1.1

1.3

1.5

Casting speed, m/min Fig 2 Computed powder consumption(6) for various oscillation frequency

1.7

0.8

1.2

1.4

1.6

1.8

Casting speed, m/min Fig 3 Computation of mould friction for different oscillation and mould powders

*The authors are with the Research and Development Centre for Iron & Steel, SAIL, Ranchi. Contact Details: kuntal@sail-rdcis.com www.steeltimesint.com

April 2014

60 CONTINUOUS CASTING

Consumption, kg/m2

0.5

0.4 Powder type A 0.3 Oscillation frequency: 100 x casting speed 0.2 0.6

1.2 0.9 1 1.1 1.3 Casting speed, m/min Fig 5 Comparison of mould powder consumption for various oscillation modes

Fig 4 Friction values with variation in oscillation frequency

existing conditions was analysed. Higher casting speed was tried with improved mould powder based on measured friction data. Mould powder consumption was monitored and the results indicated higher mould powder consumption and lower friction value even with higher casting speed. Various researchers have emphasised the importance of optimising mould powder properties and the oscillation characteristics of the mould for improvement in lubrication, reduction of mould-strand friction and consequent sticking break-out [2]. High-speed casting reduces the powder consumption rate and this may lead to sticking type break-outs. Improvement in mould lubrication, i.e. reduction of mouldstrand friction is, therefore, crucial for increasing casting speed and reducing shell cracking and break-outs. The thickness of the slag film between the strand and the mould controls mould lubrication. The slag film contains a liquid layer adjacent to the strand and a solid layer adjacent to the mould wall. The relative thickness depends on the melting point of the powder, casting speed and the heat flux across these layers. The friction in the mould is caused by the relative motion of the mould with respect to the solidifying strand in the liquid layer and movement of the solid layer with respect to the mould. The former is called “liquid friction“ [3] and the latter is termed “solid friction”(Fig 1).

Fig 6 Frictional values for casting speed from 0.8 to 0.7 m/min

April 2014

Oscillation frequency: 80 x casting speed

0.7

0.8

Since, liquid friction dominates in the upper portion of the mould where the solidifying strand is very thin and fragile, lowering of this will help reduce shell sticking and facilitate an increase in casting speed. The liquid frictional force acting near the meniscus of the mould is calculated as shown below: (1) fl =η ( Vm – Vc ) / dl Where, = fl η = Vm = Vc = dl =

Liquid friction Viscosity of liquid slag film Mould velocity Casting speed liquid film thickness between strand mould gap

It can be seen from equation (1) that frictional force is dependent on the viscosity of the mould slag, mould velocity, casting speed and thickness of the liquid slag layer. Mould velocity depends only on the oscillation characteristics of the caster. In addition to the above calculation of mould friction, another way of estimating mould lubrication is the actual measurement of mould powder consumption during casting. In case of low and medium carbon steels, powder consumption of 0.3 kg/m2 has been widely agreed as a minimum requirement of lubrication [4] for conventional slab casters. Powder consumption depends on the inmould viscosity of mould slag and the

1.4

oscillation parameters of the mould. The other important parameter that influences powder consumption is the oscillation characteristics of the caster. Various workers studied the influence of stroke and frequency of oscillation on mould powder consumption. Decrease in frequency of oscillation [5] and increase in stroke [4,5] increases powder consumption in the sinusoidal mode of oscillation. This happens due to an increase in positive strip time and reduction in negative strip ratio (NSR)[4,6]. Recent laboratory work carried out by Koichi TSUTSUMI et. al. [6] clearly explained the above findings. He also calculated the frictional force and showed that it decreases with every increase in positive strip ratio (PSR). This concept has been applied for an improvement in casting speed [8] or a decrease in break-out [2]. In the present investigation, mould friction was measured by MOMS at various casting speeds with different mould powder. Mould powder consumption was also monitored for different powders. Liquid friction of the mould was computed with varied mould oscillation parameters. The analysis indicated the deficiency of mould lubrication at a higher casting speed for a particular casting machine. With a view to improved mould lubrication, powder was suitably formulated and resulted in higher mould lubrication even at a higher speed. The actual friction measurement of the caster

Fig 7 Frictional value at 0.9m/min with new mould powder

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Asset Sale of the only Steel Mill in the Baltic States The insolvent joint stock company “Liepajas Metalurgs”, incorporated in Republic of Latvia, Brivibas street 93, Liepaja, LV-3401 (hereinafter the “Company”), represented by its administrator Haralds Velmers (hereinafter the “Administrator”) invites all interested investors (hereinafter the “Investors”) for submission of non-binding expression of interest to participate in the sale of steel mill assets (hereinafter the “Process”) owned by the Company. The main factors in the selection process of investor will be (1) the purchase price and its payment conditions, (2) the strategic rationale and integration, as well as investor’s reputation and experience, and (3) the availability and source of financial resources. The Company stopped the operations of steel mill in May 2013 due to lack of working capital and the ensuing Company’s insolvency process was initiated by the court in November 2013. With the availability of required financing from the creditors of the Company, Administrator has ensured that the equipment of steel mill is being maintained in operational condition and is in position to be fully operational in short time after purchased by Investor. According to the approved transaction structure it is expected that the investor will be offered to purchase a consolidated asset package including real estate and equipment required for operations of steel mill, as well as the legal entity operating in deep water unfreezing port. All information inquiries and correspondence should be addressed to the financial advisor of the Administrator AS IBS “Prudentia”, addressed - Krastinš, to Mr. Karlis , AS IBS Prudentia, 2a Republikas square, Riga, LV-1010, Latvia, email: investorsLM@prudentia.lv After the confirmation of the initial interest, all potential investors will be provided with a non-confidential investment overview. Detailed information and visits to Company will be available after signing a non-disclosure agreement. The deadline for submission of non-binding offers for the purchase of the Company’s steel mill assets is set at June 13th, 2014. The Administrator reserves the right to select and not to enter into any agreement with an Investor in the Process without liability for any damages. Furthermore the Administrator reserves the right to stop or amend the Process and, or the timetable, or other elements of the Process on their discretion and without any explanation. In case of such exclusion the Advisor will send written notice to the Investor on the behalf of the Administrator. Investors agree on these terms with their participation in the process. Information on the steel mill of the Company: • Steel mill is located in Liepaja city, Latvia, a member of the European Union and euro zone. It has strategically good location and connection to CIS countries and EU countries by all strategic means of transport, providing efficient logistics solutions for supplies of raw materials and sales of ready products. • Part of the consolidated asset package available to Investors include a stevedore company operating in port of Liepaja – a deep water unfreezing port, perfectly suitable for supporting the steel mill’s operations by handling the raw materials and ready products for export. • Steel mill has direct access to port by railway (distance of 2 km) and direct connection to main railway network of Latvia that allows to deliver raw materials straight to the plant. Also geographic location in EU, close proximity to CIS countries are very favorable factors in terms of cost effective delivery. • The scrap supply from the Baltic States reach up to 0.8 - 1 million tons annually, which amounts to 80-90% of the necessary scrap for maximum production of steel mill. Also other scrap export countries are close and can provide low freight costs. • Steel mill has the newest technology electric arc furnace, which was commissioned in September 2011 by STG Group (Italy) and can be considered as one of the most modern and efficient melt shops in Europe.

IBS Prudentia Global M&A Latvia Phone: +371 67212324 Fax: +371 67214319 www.prudentia.eu 2A Republikas square, LV-1010, Riga, Latvia

62 CONTINUOUS CASTING

Fig 8 Frictional value at 0.86m/min with existing mould powder

also indicated an improvement in frictional behaviour with a reduction in oscillation frequency. The modified oscillation parameter led to the achieved critical powder consumption required for troublefree casting and an improvement in caster productivity. However, for a high-speed machine, low-speed casting leads to a higher and fluctuating frictional value. Lower and stabilised mould friction can be achieved at an optimum speed range. Influence of mould oscillation on powder consumption and friction

The effect of oscillation characteristics on powder consumption has been computed and plotted in Fig 2. It can be seen that powder consumption increased as oscillation frequency decreased. The mould powder consumption was around the critical value of 0.3 kg/m2 at a casting speed of ~1.2 m/min. in the pre-modified oscillation condition i.e. 100X casting speed (Vc). It was, therefore, presumed that an increase of casting speed beyond 1.2 m/min. might lead to lubrication deficiency. The situation could be further aggravated due to the increase in viscosity of mould slag on account of Al2O3 pick-up during casting. As is seen from the Fig 2, powder consumption could be improved well above 0.3 kg/m2 at a speed >1.2 m/min. if the frequency of oscillation is maintained at 80x casting speed. The friction acting on the solidified shell inside the mould was computed and shown in Fig 3. With the existing oscillation frequency at an estimated maximum Al2O3 pick-up of 5%, the friction almost doubles at higher casting speeds due to an increase in mould slag viscosity, which increases the chances of sticker break-out. It is possible to reduce the friction to earlier levels if the frequency of oscillation is reduced to 90 x casting speed from the existing level of 100 x casting speed. Further, the proposed change in frequency led to lower NSR (61.49%) which is being practiced in various high-speed casters compared to pre-modified NSR (69.93%). The effect of the proposed change in oscillation April 2014

Fig 9 Frictional value at 1.0m/min with existing mould powder

frequency on negative strip time was marginal and is unlikely to create any surface defects. Moreover, this effect would automatically be taken care of with high-speed casting.

following properties of mould powder should be used while casting high carbon steel slab: basicity, viscosity and melting point. Plant trials

Mould powder for high carbon grades

High carbon (HC) steels (>0路4%C) have poor mechanical strength, and, to avoid sticker break-outs, a high horizontal heat flux is required, which is obtained by producing a glassy slag film [9,10]. Thus, the degree of crystallinity developed in the mould slag film must be reduced or eliminated in order to increase horizontal heat flux. In addition, molten layer film stability should be very high in order to provide for the lubrication requirement of high carbon grades. For this, powder viscosity should be on the higher side to avoid any film breakage of the liquid layer between the strand and the mould compared to powder used for low carbon (LC) grades. In order to increase casting speed for high carbon steel slab, it is necessary to have a special quality mould powder capable of providing optimum lubrication and stable thermocouple behaviour of the break-out prevention system. As cast speed is increased, instability of mould thermocouples increases too. Lowering powder viscosity would increase the powder consumption rate. However, with an increase of viscosity, the number of break-out alarms increases [11] in high carbon steel. Therefore, an optimum range of viscosity is recommended for the casting of high carbon grades. For high carbon steel grades, as the carbon content of the steel chemistry increases, the gap between the mould wall and the solidifying steel shell becomes smaller; this constricts the flow of liquid slag thus reducing the mould powder consumption rate. In addition, higher viscosity of mould slag compared to the viscosity of the powder of low carbon steel will provide mould slag film stability between the strand and the mould gap. Therefore, the

Based on the aforementioned investigations, the following process changes were made. - Monitoring of friction value with change in oscillation parameters. - Formulation of mould powder for high carbon grades to improve lubrication at higher speed. - Measurement of mould friction in a high speed caster. Mould friction was measured using MOMS and mould powder consumption was also monitored to assess the lubrication ability of the modified process parameters. Casting speed was gradually increased from 1.1m/min. to 1.25m/min. for low carbon and 0.7 m/min. to 1.0 m/min. for high carbon grades. Mould friction was measured in a high casting machine to optimise the casting speed for high carbon grades. Therefore, the following properties of mould powder should be used while casting high carbon steel slab: basicity, viscosity and melting point. Modified oscillation pattern

Mould strand interfacial friction was measured through MOMS for a particular casting speed with variation in oscillation frequency. The friction value thus observed, as shown in Fig 4, showed that there is a reduction in friction value as oscillation frequency is reduced to 90x casting speed from 100x casting speed. Data pertaining to mould powder consumption was also collected for the trial heats to assess the influence of the oscillation frequency modification on mould powder consumption. The consumption pattern at different casting speeds is shown in Fig.5. As can be seen, mould powder consumption was higher than the critical value of 0.30 kg/m2 at a maximum speed of 1.25m/min. www.steeltimesint.com

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64 CONTINUOUS CASTING

Fig 10 Frictional value at 1.0m/min with new mould powder

Oscillation monitoring

Mould Oscillation enables healing of the early fragile solidifying shell. It also enables a consistent supply of mould slag into the mould-strand gap to reduce friction. Deficiency of these gives rise to an increase in friction in the mould and leads to surface defects and break-out in extreme situations. Monitoring the oscillation performance of high carbon steels – which are prone to high instances of break-out and consequently lower casting speeds – was carried out using a portable tri-axial accelerometer-based [12] system and was carried out for existing powder. The approaches consisted of a study of friction behaviour while casting high carbon steel. Normally, friction is measured from the load increase of the oscillator drive motors in terms of force. However, here (MOMS) the friction index is a ratio of the amplitudes of the vibration frequencies >10 Hz and the total frequency range. It has been said that higher frequency vibrations arise from mould-strand interactions and are pronounced at higher speeds or because of improper alignments/lubrication. Friction behaviour during casting of HC grades with existing powder can be seen in Fig 6. Formulation of new powder

A new mould powder was formulated to improve melting behaviour and the consumption rate for better friction. The friction data (Fig 7) with new mould powder was compared with friction data (Fig 8) with existing powder[13]. The data indicated improved and lower friction, i.e. improved mould lubrication with new mould powder. Similar friction analysis was carried out at a higher casting speed (~1.0m/min.) for both powders. This is shown in Fig 9 & 10 respectively. Comparison of friction data using both powders (existing as well as new) had shown clearly that new powder had a lower and consistent friction index compared to existing powder indicating improved lubrication behaviour with new powder even at a higher casting speed (1.0m/min.). This was corroborated by April 2014

Fig 11 Reduction in mould friction with higher casting speed

improved mould powder consumption (0.45kg/m2) with new powder compared to existing powder (0.35kg/m2). Speed optimisation trial

Where casting speed in a high-speed slab caster was concerned, the friction index was monitored by MOMS to understand friction behaviour at various casting speeds [14]. Break-out prediction alarm and slab quality was also critically observed during this trial. The friction values at different casting speeds are shown in the Fig 11. The figure indicates that at a low casting speed of 1.25 m/min, the friction index is high and fluctuating. As the casting speed is increased to 1.50m/min – progressively from 1.25 m/min – the friction index is reduced and becomes stable. This is in contrast with low speed casters where the friction index increases with casting speed. Therefore, high speed machines should not be operated at a low speed range. Conclusions

Mould lubrication/friction is the most critical parameter to enhance casting speed for higher caster productivity. Mould powder properties, oscillation characteristics and casting speed determine the extent of mould lubrication/friction. On-line measurement of mould friction is an effective tool to determine the critical casting speed, oscillation parameters and mould powder properties, particularly for casting high carbon steel. Theoretical computation of mould friction and powder consumption is in line with powder consumption and actual measurement of mould friction through on-line MOMS. 5.0 Acknowledgements

The members of the taskforce are thankful to the management of the Research and Development Centre for Iron and Steel, Steel Authority of India Limited (SAIL) for permission to publish the work. References [1] K.C. Mills, “Mold operation for quality and productivity”, Process technology division, Steelmaking

Conference Proceedings, ISS,1991, pp. 85-93. [2] Peter Andrzejewski, Alfons Drastik, Karl-Ulrich Kohler, Wolfgang Pluschkell, “New aspects of oscillation mode operation and results in slab casting”, 9th PTD Conference Proceedings, AIME-ISS, 1990, pp.173-181. [3] Mikio SUZUKI, Hideaki MIZUKAMI, Toru KITAGAWA, Kiminari KAWAKAMI, Shigetaka UCHIDA and Yoshimi KOMATSU, “Development of a new mold oscillation mode for high-speed continuous casting of steel slabs”, ISIJ International, Vol. 31, 1991, No.3, pp. 254-261. [4] O.D.Kwon, J.Choi, I.R.Lee, J.W.Kim, K.H.Moon, Y.K.Shin, “Optimisation of mould oscillation pattern for the improvement of surface quality and lubrication in slab casting”, Steelmaking Conference Proceedings, ISS,1991, pp. 561-568. [5] Manfred M. Wolf, “Mold oscillation guidelines”, Steelmaking Conference Proceedings, ISS,1991, pp.51-71. [6] Koichi TSUTSUMI, Jun-ichi OHTAKE and Mitsutaka HINO, “Inflow behaviour observation of molten mould powder between mould and solidified shell by continuous casting simulator using Sn-Pb alloy and stearic acid”, ISIJ International, Vol. 40, 2000 ,No.6 , pp. 601-608. [7] D. Currey, “Optimisation of casting speed for higher productivity on Dofasco’s No. 1 continuous caster”, Steelmaking Conference Proceedings, ISS,1995, pp. 287- 294. [8] Kunio Koyama, Kyoichi Nagano, Yutaka Nagano, Taketo Nagano, “Design for chemical and physical properties of continuous casting powder”, Nippon Steel Technical Report. No.34, July 1987, pp. 41-47. [9] K.C.Mills: Proc. Alex McLean Symp., Toronto, Canada, July 1998. [10] R.Bommaraju: ISS Steelmaking Conf. Proc., 1997, 74, 131–146. [11] G.A.Geist: ISS Steelmaking Conf. Proc., 2000, 77, 389–396 [12] J Michael Kiss, Mark C Bublitz, Mustafa R Ozgu and Mark Emaus “Mould Oscillation Monitoring Operational & Maintenance tool”, 83rd Steel Making Conference & 59th Iron Making Conference, Iron & Steel Society of AIME, Pittsburgh, Pa, March 26-29, 2000 [13] Improvement in continuous casting of high carbon grades in SMS-I, RSP : RDCIS, SAIL Internal Report No.26.02.3722.01.2009 [14] Study of Mould Oscillation Characteristics in Slab Caster at BSL, : RDCIS, SAIL Internal Report No.26.02.3539.02.2006

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PERSPECTIVES: CAN-ENG 65

‘Very high demand in all sectors’ Canada-based CAN-ENG’s largest market is in the USA and the company is experiencing very high demand in all sectors where industrial furnaces are concerned, according to president Michael J Klauck. The company is working with Steel Authority of India (SAIL) on one of the most advanced wide plate quench and temper systems of its kind in the world.

1. How are things going at CANENG? Is the steel industry keeping you busy?

thicknesses from 6mm to 100mm and widths up to 3000mm. It is the first system of it’s kind for SAIL.

We are experiencing very high demand in all sectors for industrial furnaces, these include energy, defence, steel, automotive, railways, mining, and consumer goods.

8. In fact, talking of ‘green issues’ and emissions control, how is the steel industry performing in this respect?

2. What is your view on the current state of the global steel industry?

Strong demand exists for value-added finishing operations involving heat treatment. With steel used in increasingly demanding applications, combined with weight reduction, mechanical property improvement through heat treatment is witnessing continued growth.

We have the good fortune to work all over the world, so you can make comparisons between developing economies and western standards, and despite the general conception that environmental standards are lax in places like China and India, this is not always the case. Certainly China is making strides at mothballing older emitting facilities, and much of the Indian steel industry is either run by government, or global companies, that take their environmental responsibilities seriously.

3. In which sector of the steel industry does CAN-ENG mostly conduct its business?

Our focus is on long products, primarily tube, bar, and plate heat treatment. We are seeing strong demand from the open and closed die forging industry for reheating furnaces for ingots, blooms and billets. 4. Where in the world are you busiest at present?

Our largest market is the USA and if US manufacturing was a standalone economy measured on GDP terms, it would rank ahead of the entire GDP of countries like Canada and India. So while US manufacturing employment continues to fall through automation, it still represents an incredibly robust and important market for us. We have new contracts in China, Russia, India, Chile and other markets. 5. Can you discuss any major steel contracts you are working on?

We are building a wide plate quench and temper system for SAIL – Steel Authority of India Ltd. It will be one of the most advanced of its kind in the world when operational in late 2014, and will incorporate all the latest advances in combustion and automation with a highly flexible quench capable of processing plate www.steeltimesint.com

integrated plants (BF + O2 Converter) are using considerable amounts of scrap in the BOF, so the total steel production from scrap origins is even higher. So I think strong arguments can be made that steel is equally “green”.

6. Where do you stand on the aluminium versus steel argument?

There is no doubt that Al offers a number of advantages, but HSLA steels combined with heat treatment can offer weight savings and strength-to-weight ratios that will compete with aluminium on a cost per piece basis. Automotive structures such as door beam intrusions, A-pillars and Bpillars, are now made out of HSLA steels in the 1.5mm to 4mm thickness range and, combined with press quenching technologies, produce parts that are 200,000 psi TS. The steel industry is incredibly resourceful and creative at coming up with both new materials and technologies to meet end-use demands. The role of heat treatment is critical in achieving those mechanical and metallurgical properties. 7. Aluminium is the ‘greener’ than steel. What’s your view?

Steel is highly recyclable, and something like 40% of NA steel production is going the EAF route, which as you know, is entirely based on scrap. Even traditional

9. Are steelmakers looking to companies like CAN-ENG to offer them solutions in terms of energy efficiency and sustainability?

In Europe the cost of electricity and natural gas has historically been higher than in North America. For this reason, the Europeans are very focused on operating costs, or cost of ownership. From the start of the last decade onward, North American firms have been increasingly conscious of utility costs, and are now willing to build in additional capital cost for energy saving technologies with defined payback periods. Specifically, 95% of what we build are fuel-fired systems, and the acceptance of both regenerative and recuperative burner technologies (vs. ambient air), has become more widespread. There are many other developments in furnace configuration, combined with automation and robotic systems, that have eliminated wasteful heating and cooling of trays, baskets, or carriers that increased energy consumption. April 2014

66 PERSPECTIVES: CAN-ENG current shortage of value added OCTG tubing, and this requires better quality green pipes, and heat treatment to improve the mechanical properties combined with end-finishing. If steel producers focus on increasing the value of their products in relation to their markets, this will minimise the threat of 600Mt of Chinese steel raining down upon world markets.

and aluminium production. In the short-to-medium term most likely there will be a situation of over supply. India is still planning for aggressive expansion of their raw steel production, and if their GDP does not keep pace it can only mean a glut of steel on the markets.

Our focus is on industrial furnaces and automation systems related to industrial furnaces. We have developed bar quenching technology that allows us to maintain straightness on bars down to .750” through continual bar rotation during heating combined with spray quenching technology. In fact, one of the areas that we excel at is quenching technologies, as we have made considerable investment in R&D to develop this side of the business. In addition to bars, we have made quenching developments on tubes, pipes, plates, and flats, and we can deliver both batch immersion and continuous quench systems in a wide variety of media.

14. The Chinese still rely heavily upon Western steel production technology. What is CAN-ENG’s experience of the Chinese steel industry?

As manufacturing has shifted to lower cost environments around the globe, Canadian Steel output has fallen accordingly. Where there are investments, it is in the finishing end and is related to vast shale gas deposits in the North Eastern USA and Western Canada.

12. How do you view CAN-ENG’s development over the short-tomedium term in relation to the global steel industry?

Absolutely downstream. For steelmakers to survive they must invest in the oft ignored and less sexy finishing end of the production process. Many steelmakers focus on tons per year, and certainly this is the most capital-intensive portion of their operations, but targeted investments in heat treatment will pay big dividends at moving the contribution margin up the food chain.

10. How quickly has the steel industry responded to ‘green politics’ in terms of making the production process more environmentally friendly?

This is a question that is probably better directed to steel producers. 11. Where does CAN-ENG lead the field in terms of production technology?

We are very pleased with our progress, our revenue has tripled in the past decade, and we see increasing investment at the finishing end of the steelmaking process, which means more heat treatment. 13. China dominates global crude steel production and is accountable for almost half of total production. How should the industry react to this situation?

The focus should not be so much on tons produced in China, but value-added and contribution margin. For example, ERW HSS (High Strength Structural) tubing is a commodity that is largely bought and sold on price. In North America there is a

We do have some activity with Tier 1 automotive suppliers in China for new proprietary industrial furnace technology, but our friends in Germany and Italy were quick to recognise the development in China and capitalise on the investments. As more value added heat treatment comes on stream in China, we will participate. 15. Where do you see most innovation in terms of production technologies – primary, secondary or more downstream?

16. How optimistic are you for the global steel industry?

A lot of this will depend on demographics and population increase. After the middle of this century demographers are predicting that global population will decline, and emerging economies will be developed, so this will be a new era for all manufacturers, and one can only imagine that there will be corrections in both steel

17. CAN-ENG is based in Canada, but what’s happening steel-wise in the country?

18. It has been said that the EU steel industry needs to permanently remove about 30Mt to 40Mt of excess production capacity to realign it with demand. The European Union has a production capacity of about 210Mt and there are signs that European steel demand will grow next year as customers replenish their inventories. What’s your view?

Europe faces similar challenges to Canada and the USA. We are high cost producers, and the historical rules for location of steel manufacturing no longer apply. In high cost environments only the strong survive, and to some degree we went through that pain in the USA in the 1980s, when steel capacity was cut from a peak of 150Mt in 1973 to 75Mt in 1982. While the US industry rebounded somewhat, we all have to recognise that it is a global market and we must compete on that basis. 19. What keeps you awake at night?

2009 and the threat of another year like it. The near global melt down put the brakes on capital equipment investment and similar severe downturns are especially difficult for capital equipment manufacturers like CAN-ENG. So let’s hope that when the next downturn comes, it’s not so severe. 21. If you possessed a superpower, how would you use it to improve the global steel industry?

A quench and temper furnace system from Can-Eng of Canada April 2014

On a global scale, the steel industry is still incredibly fragmented, and even giants like Arcelor Mittal control probably less than 10% of the output. With this fragmentation you have a lot of political objectives initiated by various countries that, while good on a regional level (ie. employment) creates over supply in the market place that ultimately play out on the global stage. Trying to unify global policy on this would probably be akin to solving world peace, which would be another great application for a superpower. www.steeltimesint.com

Germano Mendes de Paula

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68 HISTORY

The arms race

This large gun, overlooking Monaco harbour, weighs four tonnes and was cast in England about 1750

When the weapons of war changed from spears and catapults to cannon and mortar, the technology to make them involved smelting various metals to temperatures in excess of 1,000 deg C, writes Harry Hodson*

THE manufacture of arms has always been a lucrative trade especially from the 15th century onwards when gunpowder was widely available. Heavy cannon and mortar became the weapons of choice to wage war on land and sea. Blacksmiths and armourers had previously supplied swords and spears and protective clothing, carpenters and fletchers made machines, catapults and missiles to fire at the enemy. As these weapons began to be phased out, the new technology to make heavy cannon required someone who could smelt various metals to temperatures in excess of 1,000 deg C. In the first instance, this became the job of the local brass founder whose main business was the supply of domestic and ornamental castings, which in due course began to include the odd cannon or mortar. There were no restrictions on the practice, so as a consequence, anyone could equip an army of men with these terrible weapons – with no questions asked. Foundries making cannons

The manufacture of arms eventually became the business of governments and was strictly controlled in some European countries. Even so, there was still quite a good number of foundries making cannons and supplying them to ships under the control of a privateer, of which the British government turned a blind eye. In 1540, Henry Vlll began to modernise the Royal Navy and equipped his flagship, the Mary Rose, with heavy bronze cannon – which may well have contributed to the sinking of the ship, which toppled over in the Solent in 1545. When the Mary Rose was raised together with some of the cannon 450 years later, the cannon revealed some remarkable details of high quality workmanship including the makers’ names. Some of them had been made in London and bore the date 1542, while others, also of the same design and date, were made in Milan. It would seem that Henry had a reason for this by not

beholding to one supplier – a practice still in force today. In 1773, the British government decided to update the Royal Arsenal at Woolwich, prompted by what appeared to be a better and more accurate cannon being made abroad. It was a costly project, which involved making new furnaces, pattern and machine shops, and a team of metallurgists equipped with five-tonne weighing scales and metal testing laboratories. The new incumbents in charge were Jan and Pieter Verbruggen, a father and son who had previously been master gunfounders to the Dutch government. Their appointment coincided with a period of deteriorating relations with Holland whose navy was now a cause of concern to the Royal Navy. New ideas

Also at this time, new ideas were constantly being introduced in the making of cannons. The barrel of a cannon is usually cast around a sand core in the mould, the core being supported by metal studs to prevent movement during the casting process. As the studs did not melt they became a weak spot in the barrel. Another fault was trapped air causing ‘blow holes’ which needed to be plugged during the finishing process of the barrel. In 1775, King George lll visited the Royal Arsenal to see six cannons cast at the same time from a furnace yielding 18 tons of metal from a single tapping. An early lithograph shows the Verbruggens explaining to onlookers the advantages of the new ideas and better equipment. The cannon moulds had been made traditionally in a two-parted moulding box, but instead of casting them horizontally, they were now being cast in the vertical position. Also, the section of the mould containing the muzzle of the barrel was left open with extra length to allow for the machining of the uneven finish. Vertical casting in an open mould allowed a better escape of gasses and air, therefore

eliminating much of the need for plugging. New laws meant that the guns supplied to the Government had to be tested in a ‘proofing house’, consequently this led to many guns being scrapped or returned to the maker for further ‘plugging’ of which there was a strict limit allowed in the number of plugs per barrel. Cast iron began to replace gun metal as a cheaper alternative especially when the above practices had been put into place. In 1776 the chronicler and traveller Arthur Young reported, “I have been to the green ironworks of Mr. John Wilkinson to see the latest ideas in the making of ironware. Every domestic and industrial item is made on a large scale, including cannons being cast solid and bored out on a large machine, 12 at the same time.” John ‘Iron Mad’ Wilkinson laid claim to a number of innovations in the iron trade including the casting and boring of solid cannon barrels. It is believed that this practice was in use in Austria and Switzerland a century before Wilkinson took out a British patent in 1774. Burning

Some years ago, a large cannon recovered from a shipwreck off the South Coast of England appeared to have been ‘welded’ across part of the barrel. As the cannon could be dated to about 1700, there was plenty of interest surrounding how this technology was implemented. The Institute of Foundrymen quite rightly commented that the cannon barrel had been ‘burned’ to repair a fault. The author has some experience with this method, which requires careful preparation. In this case, the gun barrel would have been partly buried in the foundry floor at an angle of about 30 degrees. A shallow ‘reservoir’ was allowed to escape through a hole at the lower end until it was decided that fusion had taken place. This was just one trick of the trade of the foundryman – but there were many more.

* Email: harryhodson39@ntlworld.com April 2014

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