Sti march 2015

March 2015 – Vol.39 No.2 – www.steeltimesint.com

FURNACES CONTINUOUS CASTING PERSPECTIVES

STEEL TIMES INTERNATIONAL – March 2015 – Vol.39 No.2

NORTH AMERICAN STEEL CONFERENCE COVER MARCH.indd 1

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CONTENTS MARCH 2015

March 2015 – Vol.39 No.2 – www.steeltimesint.com

FURNACES CONTINUOUS CASTING PERSPECTIVES

STEEL TIMES INTERNATIONAL – March 2015 – Vol.39 No.2

Picture courtesy of Oerlikon Leybold Vacuum.

NORTH AMERICAN STEEL CONFERENCE COVER MARCH.indd 1

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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 Area Sales Manager Anne Considine anneconsidine@quartzltd.com Tel: +44 (0) 1737 855139

2 Leader 4 News The latest steel industry news from around the world.

11 USA update A distinctive mood of uncertainty.

13 Latin America update The flight of the Phoenix.

14 China update China - is Europe a soft touch?

16 India update Jindal steel and Power in dire straits.

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Iron ore 18 Towards cheaper ore?

New Year predictions 19 A poor year for pricing power.

Conference report: North America 22 Production, prices and products under discussion in the Windy City.

Continuous casting 27 A metallurgical view of casting.

Sales Director Ken Clark kenclark@quartzltd.com Tel: +44 (0) 1737 855117

Advertisement Production Martin Lawrence

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31 Wireless signal transmission for the ladle turret on continuous casters.

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SUBSCRIPTION Elizabeth Barford Tel +44 (0) 1737 855028 Fax +44 (0) 1737 855034 Email subscriptions@quartzltd.com Steel Times International is published eight times a year and is available on subscription. Annual subscription: UK £168.00 Other countries: £240.00 2 years subscription: UK £302.00 Other countries: £432.00 ) Single copy (inc postage): £38.00 Email: steel@quartzltd.com Published by: Quartz Business Media Ltd, Quartz House, 20 Clarendon Road,

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Redhill, Surrey, RH1 1QX, England.

Furnaces 34 Building SAIL’s new blast furnace.

Tel: +44 (0)1737 855000 Fax: +44 (0)1737 855034

38 Improving energy efficiency in a rotary kiln for lime production.

www.steeltimesint.com 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

Perspectives 42 Global contracts with big players.

Emigsville, PA. POSTMASTER send address changes to Steel Times International c/o PO Box 437, Emigsville, PA 17318-0437.

Printed in England by: Pensord, Tram Road, Pontlanfraith, Blackwood, Gwent NP12 2YA, UK ©Quartz Business Media Ltd 2015

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History 44 A difficult decade for steel.

ISSN1475-455X

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Contents MARCH.indd 1

March 2015

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matthewmoggridge@quartzltd.com

Will hell freeze over before the EU tackles China?

Matthew Moggridge, Editor In a few days from the time of writing this leader, I’ll be on my way from London to Rio de Janeiro in Brazil to attend CRU’s World Steel Conference. It will be the first time that a Moggridge has been to South America since just before the First World War when my grandad travelled to Argentina to live with his brother William. There are some grainy, sepia-tinted photographs of my grandfather’s sibling lifting a woman over his head in what seems to be some kind of weight-lifting circus act, although I have it on good authority that my direct descendant, George Harry Moggridge, was working with horses until he decided to return home to fight in the Great War. I think I would have stayed in Argentina with the gauchos and the beef steaks.

The World Steel Conference is shaping up to be an interesting occasion as, indeed, was last year’s event in Prague. One thing is certain: China will definitely be on the agenda.

We all know the crux of the problem: China’s economy is slowing down, the country produces way too much steel and so it exports around 90Mt of it around the world – much to the dismay of European, American, Latin American and Asian steelmakers who cannot compete on price for all sorts of reasons, not least because the Chinese government subsidises its stateowned steel production companies and, up until recently, offered tax incentives to those exporting steel.

While none of this is ‘breaking news’, what I did find slightly unusual recently was to hear that the UK steel industry had joined global calls for a ‘level playing field.’ The British construction industry has become more buoyant than elsewhere in Europe – cue tonnes of inferior Chinese steel products arriving at British dockyards.

I’m used to the American steel industry making a big fuss about the rise in OCTG imports from China – and then invoking anti-dumping laws and countervailing duties – but it’s odd to hear it from the UK steel industry. Perhaps it’s the great British reserve that inclines us to be less vocal and reactionary than the Americans.

Whatever the cause, some say it is beyond the EU to do anything about it. Europe is simply too soft a touch, they argue, while others insist that the European ‘machine’ is cumbersome and slow-moving and that hell will freeze over before we take the Chinese to task. www.steeltimesint.com

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4 NEWS IN BRIEF ArcelorMittal steel for Ukraine VW showroom A Volkswagen showroom in the Ukraine is the happy recipient of 700 tonnes of 8-28mm rebar produced

by ArcelorMittal Kryvyil Rih also based in the Ukraine.

The showroom – the first VW dealer centre in Kryvyi Rih – will open its doors in February 2016.

INDUSTRY NEWS

Stoilensky plant open soon

ThyssenKrupp Aerospace opens in India ThyssenKrupp Aerospace has opened its first ever facility in Bengaluru, India, with a view to meeting rising demand from the local aerospace industry.

The 3,300 sq m site will stock the complete range of aerospace materials including aluminium, titanium and steel in bars, plates, sheets, rounds and more.

New director for UK Steel

Stoilensky, one of the largest iron ore producers in Russia, and one of the most effective globally in terms of production costs and profitability, according to parent company NLMK Group, has begun the installation of equipment at its new pelletising plant in Russia’s Belgorod region.

The plant is located at Stary Oskol, which is 300km from NLMK’s Lipetsk production site.

The new pelletising plant is part of NLMK Group’s Strategy 2017 and will enable the steel maker to produce pellets for its Lipetsk blast furnace operations in the most cost-effective way, claims the company.

Sergei Napolskikh, Stoilensky’s

general director, said that the new plant was one of the largest and most modern industrial projects currently under construction in Russia. “It was designed using the best available technologies and equipment,” he said, adding that NLMK had ‘set a good pace’ last year and was going full steam ahead to launch the plant next year (2016) to celebrate Stoilensky’s 55th anniversary.

An NLMK spokesman said that most of the iron ore concentrate and sinter ore produced by Stoilensky is used by the Lipetsk production site. Excess capacity is sold to third parties. However, the NLMK Group has no pelletising plant and has to buy around 6Mt/

yr of pellets from third parties.

When the new plant comes on stream next year, the NLMK Group will be able to use its own pellets at a much cheaper production cost than the current set-up, the spokesman said.

Roller screens for sorting bulk materials and 900m3 bunkers, as well as 244 pellet cars, are currently being installed on-site. The pellet cars are being installed in the thermal processing section where pellets are dried and baked. Mixer units and conveyors have already been assembled.

Deliveries of process equipment will be completed by the end of 2015 and wall erection, roofing and painting by January 2016.

Action plan for Chinese steel Gareth Stace has been appointed director of UK Steel, replacing Ian Rodgers who retires on 31 March.

Stace (pictured above) is currently head of climate and environment policy at EEF, the manufacturers’ organisation where he leads on a broad range of energy and environment policies, from compliance through to competitiveness.

Esmark Serbian deal falls through USA-based Esmark Inc’s plan to buy the Zelezara Smederevo Steelworks, a former US Steel plant in Serbia, has fallen through because the company was unable to agree final terms with the Serbian government.

According to Esmark’s CEO James Bouchard the Serbian government is to blame for trying to change the deal at the last minute after key terms had been negotiated.

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

China’s Ministry of Industry and Information Technology (MIIT) is formulating an action plan for the country’s domestic steel industry.

The MIIT will also be compiling medium and long-term development plans for the iron ore industry, it is claimed.

The plans include abolishing import tariff reduction and exemption, promoting high-end steel products and revising management standards.

Source: China Metals

Tata’s £11 million new decoiler

Italian steel processing machinery company FIMI has installed an £11 million heavygauge decoiler at a state-of-the-art steel plant in South Wales owned by Tata Steel.

The new equipment enables the plant in Llanwern is claimed to be the most powerful of its kind in Europe and can process 270kt of hot-rolled coil per year, claims Tata Steel.

Energy usage report available Energy usage is the subject of a new worldsteel technical report.

There are five sections to the new report covering process routes and energy boundaries, energy assessment model methodology and its benchmarking benefits, economic aspects of energy investments, general processes and techniques and energy source utilisation in metallurgical plant.

According to worldsteel, “The report highlights that there is no single solution for steel plants to decrease their energy intensity and identifies the main factors that affect the energy intensity.”

The report points out that the optimal selection of production processes and raw materials, increased use of economically available scrap, transfer of best

practices, waste heat recovery and reduction of yield losses will provide the main opportunities for energy saving in the future.

Comparisons between BOF and EAF steel making are made and the report argues that the type of energy source, the quality of the raw material and ferrous scrap content directly affects the intensity of GHG emissions.

March 2015

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INDUSTRY NEWS

New steel from NSSMC Nippon Steel & Sumitomo Metal Corporation (NSSMC) has developed HRX19, a new brand of stainless steel designed for high-pressure hydrogen environments.

The new product was exhibited by the steel maker at the International Hydrogen & Fuel Cell Expo in Tokyo last month (25-27 February) and has already been used for heat exchangers, joints and valves of commercial-use hydrogen stations, claims the company.

HRX19 is described as a highstrength austenitic stainless steel manufactured under conditions of full integration from raw materials procurement through to final pro-

cessing, which guarantees quality, claims NSSMC. The product has three distinctive features. First, it’s ‘excellent resistance to hydrogen gas embrittlement’; second, it’s high strength; and third its ‘excellent weldability’.

According to NSSMC, ‘this steel can contribute to (the) reduction

of costs and the improvement of maintainability and safety in constructing hydrogen stations.’

The Iwatani Corporation and other companies have already used the new product in the construction of commercial hydrogen stations, claims NSSMC.

Tata Steel wins UK rail contract A contract to supply highly wear-resistant rail for the London, UK-based Crossrail project has been awarded to Tata Steel.

Crossrail will run beneath London and will serve 40 stations.

It will travel 100km from Reading and Heathrow in the west, through central London underground to Shenfield and Abbey Wood in the east.

Tata will supply more than 57km of its heat-treated, wear-resistant rail – 7kt of steel in weight terms.

Gérard Glas, Tata Steel’s rail sector head, said the Crossrail project would have a huge impact on ‘improving the commuter experience’ in London.

“Rather than using traditional methods of heating and cooling, Tata Steel has developed a system where the rail moves through an induction furnace which uses an electromagnetic field to heat the

steel to 950C. The rail is then rapidly cooled using compressed air.

The resulting uniquely low residual stresses provide further protection against risk of failure compared to other in-lne heat treatment pro-

cesses,” he explained.

Crossrail’s steel will be manufactured at Tata’s production site in Scunthorpe and then rolled in Northern France at the company’s Hayange mill.

www.steeltimesint.com

Industry News march.indd 2

Shindo highlights teamwork for 2015 Kosei Shindo, president of Nippon Steel & Sumitomo Metal Corporation (NSSMC) has highlighted to employees what he regards as priorities for the company in 2015.

In a New Year message to employees, he said 2014 was blighted by five accidents, which have dented trust in the company.

“It is absolutely essential that we regain [the] trust of our customers, community and the society,” he added.

Chinese steel makers reduce energy consumption China’s major steel makers reduced energy consumption per tonne of steel produced by 1.2% and combined water usage by 0.6%.

Wastewater was reduced by 5%, sulphur oxide emissions by 16% and smoke and dust discharge by 9.1% according to figures released

by China’s Ministry of Industry and Information Technology (MIIT).

Source: China Metals

NLMK outsources logistics NLMK Group, Russia’s largest steel maker, is to launch a pilot project for outsourcing internal logistics for its long products division.

The plan is to use Freight One, Russia’s largest rail freight operator to manage railway transportation at the company’s Urals sites (NSMMZ and NLMK Metalware) and lease rolling stock from NLMK Group and manage the railway department shared by the two plants. Track and locomotive maintenance will be included in the plan.

Slowing GDP prompts efficiency drive

Balkan steel plant upgrade ArcelorMittal Zenica, the largest steelmaker in Bosnia and Herzegovina, is investing 4.65 million Euros to further enhance its production facilities.

Once completed, the plant will be capable of producing high density coils of rebar and will be able to reduce the cost of finishing, according to ArcelorMittal, the world’s largest steel maker.

5

NEWS IN BRIEF

In fact, once the enhancement work is finished, ArcelorMittal Zenica will be the only steel maker in the Balkan region producing rebar, it is claimed. This fact alone will boost the company’s market share in South East Europe and extend the plant’s product range.

Since acquiring the steel plant in 2004, ArcelorMittal Zenica has invested over 154 million Euros

on equipping it for the market.

The current upgrading project follows hot on the heels of an earlier 5.5 million Euro scheme to install new filters in the plant’s basic oxygen furnace (BOF), which, claims ArcelorMittal, will ‘bring major improvements to the factory’s environmental footprint.’

The company behind the enhancement work is SMS Group.

OJSC Magnitogorsk Iron and Steel Works (MMK) has announced plans to maintain production volumes at approximately 12Mt for the next decade.

Maxim Lapin, director for business development and efficiency at MMK said that the plan was to focus on efficiency at its Magnitogorsk facility, meaning production with minimal costs but still maintaining a quality product.

POSCO to use Finex DRI in Iran South Korean steel maker POSCO is planning to use Finex DRI steel making technology, developed in conjunction with Siemens VAI, in projects in Iran, according to an online media report.

March 2015

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INDUSTRY NEWS

The EU must act on China EUROFER has strongly criticised China for its foreign trade-distorting industrial policies, claiming that they are detrimental to the recovery of the European steel industry.

The introduction of VAT export rebates (of between 9% and 13%) for Chinese steel makers had promoted the export of higher value-added products, claims EUROFER’s director-general, Axel Eggert.

While the rebate was lifted on 1 January 2015 – meaning it no longer applies to steel products containing boron, a chemical element used to harden steel – Chinese steel makers are getting round rebate removal by replacing boron with other alloys, such as chrome.

“The boron-specific VAT removal is a welcome sign of China's

awareness of concerns voiced by the global steel industry on China's steel policy and practices. But this measure is lacking commitment because it excludes the basic hotrolled wide strip product while at the same time creating new incentives for Chinese exporters to continue enjoying the export rebate through the back door”, Eggert explained.

According to Eggert, the result might lead to the European steel industry witnessing a continuation of the peak exports recorded last year for alloyed products despite the rebate on boron-alloyed steel being dropped.

European imports of Chinese boron-alloyed steel products surged in the first 10 months of 2014 year-on-year by +83% (plate) and +375% (rebar).

According to Eggert, “Trade-dis-

torting industrial policies by third countries are detrimental to the recovery of the European steel industry and destroy jobs in Europe”. He added that the EU must ‘vigorously act’ to re-establish fair trade for European steel makers and strongly welcomed the European Commission’s awareness of the problem.

NPD boosts financial results The introduction of 22 new steel products has played a significant role in Tata Steel’s improved financial performance during FY2014/15.

The company claims that ‘portfolio enhancement’ improved the fortunes of the business and plans to continue with its new product development (NPD) strategy.

Some 22 new products were introduced during the first nine months of the year and there are now 100 products in the portfolio, claims Tata, including Celsius 420, a structural steel tube prod-

uct offering easy weldability and fabrication as well as higher yield strength.

The company intends to introduce further additions to its product range in the hope of achieving ‘a sustainable financial performance’.

According to Tata, due diligence work ‘on the potential sale of the Long Products Europe business to the Klesch Group’ continues.

Tata’s CEO for European operations, Karl Koehler, says that the company’s financial performance improvements have been gather-

ing strength and that the transformation of its product mix has gone a long way towards giving Tata customers a competitive edge.

“We have just passed a significant milestone in this journey after launching the 100th new product in our portfolio,” he said, adding demand for European steel continued to recover in 2014 and should improve modestly in 2015.

As Tata enters its final quarter of FY15, Koehler sees opportunities to improve the company’s performance and strengthen its position in Europe.

UK wants ‘level playing field’ A report on the BBC website claims that UK-based steel makers Tata and Celsa, which employ over 7,500 people in Wales, are making See China Update for more on this story.

a stand on cheap foreign steel imports which are causing the industry to stagnate.

The BBC’s Wales business correspondent, Brian Meechan, claims that cheap imported steel from China is being used instead of UK steel.

It’s a familiar story echoed in other parts of the world, namely in the USA and the EU, where the key objective is to establish a level playing field to enable domestic steel producers to compete on an equal footing to those operating in countries like China where fi-

nancial incentives are provided by the government to steel makers who then export their products and compete unfairly with indigenous producers who have higher energy costs and business rates to contend with.

While UK steel production in 2013 was looking promising, it levelled off in 2014 with a rise in steel output of just 0.2%. Imports now account for 60% of the market and the director of UK Steel, Ian Rodgers, wants to UK Government to ‘act vigorously’.

Source: bbc.co.uk

MMK’s IT solution OJSC Magnitogorsk Iron & Steel Works (MMK) has adopted what it calls a ‘broad IT development strategy’ as part of an advanced IT adoption programme launched in 2014.

The plan is to implement an integrated in-house corporate communications system, mobile access to core business applications, modelling and forecasting and continuous planning on customised production and operational management.

A pivotal element of the Russian steelmaker’s IT programme is a mobility project involving the creation of new mobile applications that allow the company’s customers to monitor delivery status online and offer complete transparency from ordering through to final delivery.

According to MMK, a mobile maintenance and repairs application ‘makes it possible to ensure the timely execution of both scheduled and unscheduled repairs’ and detects equipment defects early on. Once launched the company expects a reduction in breakdowns and unscheduled equipment downtime.

Since July of last year the system has been an experimental-industrial pilot operation at MMK’s sintering plant.

Over the past year the company has launched other mobile applications designed to optimise business processes and in-house corporate communications.

China exports 94Mt of steel China exported almost 94Mt of steel products in 2014, a rise of 50.5% over 2013, according to figures from China’s National Bureau of Statistics (NRB). Steel imports maintained a steady growth of 2.5% to stand at 14.43Mt. Last year, net steel exports by China was equivalent to a crude steel export figure of 84.41Mt, up from 33.08Mt in 2013, according to the China Iron and Steel Association (CISA).

High value-added steel took up a larger proportion of China’s overall steel exports last year, according to CISA Source: China Metals March 2015

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INDUSTRY NEWS

Crude production up 1.2% World crude steel production reached 1.66 billion tonnes in 2014, up 1.2% when compared to the previous year.

The most robust growth was seen in the Middle East – the smallest region for crude steel production, according to the World Steel Association (worldsteel).

Modest growth was witnessed in the EU 28, North America and Asia and there was a decrease in production in the CIS and South America.

In Asia, annual crude steel production was 1.13 billion tonnes in 2014, up 1.4% when compared

with 2013. In China crude steel production increased by 0.9% to 822.7Mt (0.8 billion tonnes) but its share of world crude steel production slipped from 49.7% in 2013 to 49.5% in 2014. Japan's output was up 0.1% from 2013 to 110.7Mt and South Korea's figures were up 7.5% to 71Mt. Compared with 2013, the European Union saw a 1.7% increase in crude steel production in 2014 having produced 169.2Mt. The Germans produced 42.9Mt, up 0.7% while the Italians produced 23.7Mt, down by 1.4% when compared to 2013. The French

steel industry increased production by 2.9% to 16.1Mt, but the Spanish industry witnessed a decline of 0.6% over 2013 figures and produced 14.2Mt of crude steel.

On the other side of the Atlantic, the USA increased production by 2% to 121.2Mt. Russia’s crude steel production was up by 2.6% to 70.7Mt when compared with 2013 figures.

Ukraine's crude steel production, however, was down 17.1% with a year-end figure of 27.2Mt. The CIS as a whole was down by 2.8%, producing 105.3Mt.

In South America, annual crude steel production was down 1.4% when compared with 2013 figures. In total the region produced 45.2Mt. Brazil produced 39.9Mt, down 0.7% on 2013.

In December 2014, world crude steel production for the 65 countries reporting to worldsteel was 133.7Mt, an increase of 0.1% compared to December 2013. The overall capacity utilisation ratio for the 65 countries in December 2014 was down from 78.4% in 2013 to 76.7%.

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

DIARY OF EVENTS March

April

31-02 16th Asian Ferro-alloys Conference Shangri-La Hotel, Singapore A forum to meet potential clients and suppliers from all over the world, this event is billed as ‘the event of the year’ by the organiser.

For further information, log on to www.metalbulletin.com/events/

06-09 Metal Steel Saudi Riyadh, Saudi Arabia A leading business-to-business gathering in the Gulf region for the steel, steel fabrication and metallurgy industries.

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SERVING THE STEEL INDUSTRY March 2015

Industry News march.indd 4

www.steeltimesint.com

3/17/15 12:34 PM

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USA UPDATE

11

A distinctive mood of uncertainty Under normal circumstances, the steel industry would have rejoiced at the prospect of oil prices falling because of its cost-cutting impact on steel production, but the steep decline has caused a great deal of consternation in the industry, argues Manik Mehta* THE reasons for the concern should be obvious. The first tell-tale signs were visible when US Steel Corp recently announced that it was temporarily pruning its operations at two sites – one in Alabama and the other in Texas – eliminating in the process roughly 1,920 jobs.

The sites affected by this decision were the Fairfield Tubular and the Fairfield Works in Fairfield, Alabama, and the Lone Star Tubular Operations in Lone Star, Texas; these operations are connected with steel pipes and tubes to oil and gas-drilling companies which have been axing their orders as oil and gas prices keep falling.

In a statement, US Steel said that its “adjustment in operations” – a euphemism for cutbacks – was the result of softening market conditions that reflected the “cyclical nature of the energy market”. Furthermore, unfair trade and fluctuating oil prices continued to impact the business.

But the Alabama and Texas plants were not the only ones to be affected. Earlier, the company had announced the idling of its plants in Ohio and Texas, with the grim prospect of axing up to 756 jobs.

The link between falling oil prices and curtailing operations of steel companies becomes glaringly obvious. Oil prices have come down to some $50 a barrel – a decline that could hit the entire steel industry, which has braced itself in recent years to supply the drilling sector at sites

such as Marcellus Shale, the Gulf of Mexico, and so on.

Although there are several nonAmerican companies operating plants in several states, US Steel seems to be among the first to be affected partly because it is also one of the biggest producers and, partly, because it has led the pack that raised prices, analysts told Steel Times International.

Other steel companies with a strong US steel manufacturing base such as Nucor Corp., Steel Dynamics and ArcelorMittal, will be cutting or have already cut down their production to sustain higher prices which have nose-dived to the lowest level during the last half decade.

But that is not the end of the story: the excessive supply in the country has worsened because of sharply rising imports of such products.

US Steel, which faces strong pressure to reverse the losses it has recorded over five years, had put its eggs in the energyrelated business. The company had already cut down operations at plants in McKeesport, Pennsylvania, and Bellville, Texas, because of competition from foreign imports. These operations have not yet been re-started.

With Mario Longhi, US Steel’s chief executive, in a combative mood to cut costs and make the company more efficient, analysts expect him to aggressively use the cost-cutting axe in an effort to achieve

profitability. The company has reported losses for the last five years, including the $1.7 billion loss suffered in 2013, but is planning to build more electric arc furnaces with the aim of using scrap, instead of iron ore, to produce steel.

Besides, such furnaces do not consume large quantities of coke.

Longhi’s mantra has been to use the cost-saving axe and put the company on the profit-making track. He has already closed two plants last year – one in Pennsylvania and the other one in Texas – shelved an iron ore project in Minnesota, and “let go” a loss-making operation in Canada.

The current mood in the USA is one of uncertainty; this is a far cry from the upbeat mood evident a year ago because of the then thriving energy and automotive sectors, which bolstered large volumes of steel consumption.

Lower oil prices, coupled with a supply glut and surplus imported products, have led to a weak market situation in the steel industry, which had envisioned rising demand in the energy sector.

As if the collapse of the energy sector was not enough, the steel industry in the USA faces sharp criticism from across the borders in Quebec, Canada, where a group representing the local structural steel industry has accused US steelmakers of taking away Canadian jobs and hitting profits. The group complained that local

*USA correspondent www.steeltimesint.com

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12

USA UPDATE

suppliers were not getting enough orders from the $5 billion federal project to replace the Champlain Bridge. Group representatives recently said at a press conference that the sector, employing some 17,000 people, could end up losing their jobs.

The Quebec director of the Canadian Institute of Steel Construction (CISC), Hellen Christodoulou, was widely quoted in the US media as saying that the “Buy America” slogan, initiated in the United States, was promoting protectionist tendencies and denying Canadian suppliers the opportunity to participate in local supplies, arguing that Canada, by the same token, should ensure that big public works projects such as the Champlain Bridge, were given to domestic Canadian companies. She pointed out that, since 2012, some 30 US states had committed themselves to the ‘Buy America’ provisions, which were discriminatory against Canadian companies.

The Canadians have also been worried by a burgeoning trade deficit in structural steel trade with the USA; after posting a $1.4 billion surplus in 2002, Canada recorded a $600 million deficit in 2012.

The CISC wrote to the federal minister for

March 2015

USA.indd 2

infrastructure and other cabinet members, urging the federal government to distribute the $53 billion fund for building Canada to Canadians.

The Champlain Bridge project does not come under the purview of international trade agreement, with Canada having the free option to set its own terms for procurement, the CISC argued. Ed Fast, Canada’s International Trade Minister, stated that the ‘Buy America provisions’ would not be acceptable and would be seen as an affront to Canadian sovereignty.

The American Iron and Steel Institute (AISI) recently announced that it was joining the Cold-Formed Steel Research Consortium (CFSRC), which is a group of principal investigators from several universities who are sharing their experimental and computational facilities to undertake specific projects that span all aspects of cold-formed steel structural research.

AISI joined the CFSRC as a founding member.

The consortium comprises the world’s leading researchers in cold-formed steel structural design from the John Hopkins University, Virginia Tech, McGill University, University of North Texas,

University of Massachusetts-Amherst, Northeast University and the University of Massachusetts-Dartmouth.

The industry, working in tandem with academia within this consortium, will identify long-term research needs that advance cold-formed steel design technologies and practices in building construction, and develop a roadmap to prioritise research projects and undertake the work. When the research projects are completed, the consortium will deliver the findings and results to engineers, architects, and other building construction professionals via technology transfer sessions such as webinars, industry events and seminars.

Robert Wills, vice president of the Construction, Steel Market Development Institute, a business unit of AISI, said that the “Cold-Formed Steel Research Consortium give us an unprecedented opportunity to bring this significant talent pool and the resources of their research laboratories together in a combined effort. We expect this effort will streamline the research process and deliver new technologies and design practices to the marketplace in a more time-efficient and cost-effective manner”. t

www.steeltimesint.com

3/13/15 11:08 AM

13

LATIN AMERICA UPDATE

The flight of the phoenix In December 2014, Altos Hornos de México (AHMSA), one of the country’s largest steel mills, announced that it requested the lifting of a 15-year suspension of payments, after reaching an agreement with creditors over a $1.7bn debt. The Court approved this petition in January 2015. In this context, it seems interesting to analyse the recent trajectory of this flat steel producer.

By Germano Mendes de Paula* IN May 1999, AHMSA filed for creditor protection under an old bankruptcy law that did not determine a deadline to conclude the reorganisation plan. A new law, which became effective in May 2000, eliminated this problem. At that time, the company’s bank debt was reported to be about $1.9bn and its total debt nearly $2.4bn. This situation was derived from an ambitious investment programme that AHMSA embarked upon after its privatisation. In 1991, it had a 2.8Mt/yr crude steel capacity (STI, May 2000, p.

51).

In the period 1992-1997, the company invested $1.3bn, 68% of which was in its steel plants and the balance in iron ore and coal mining facilities. It must be said that part of these investments was related to the commitments agreed during the company’s privatisation tender. Besides the modernisation and enlargement of its coke-integrated mill to 3.8Mt/yr, it bought Aceros Nacionales (a long products producer) in 1995 and reopened the Cerro de Mercado iron ore mine. It also invested in the enhancement of its product mix

and started to produce galvanised sheet in 1996 and pre-painted strip in 1997.

By 1998, AHMSA’s financial situation had already deteriorated. In July, it announced a cost reduction plan (denominated AHMSA XXI) that emphasised the reduction of the number of employees and the delay or cancellation of some planned investments. The company sold two units in February 1999. Imsa (now part of Ternium) bought the galvanising plant and pre-painting line for US$105M. Deacero purchased Aceros Nacionales for US$53M. As this de-leverage was not enough, in May 1999, AHMSA asked for creditor protection.

The Fénix project AHMSA produced 3.7Mt of crude steel in 1998, but the outcome level reduced to 3.4Mt in 1999. After the company obtained creditor protection, in the period 2000-2005, its annual average production was equivalent to 3.1Mt (Fig 1), showing that the company was facing problems trying to sustain and increase production.

To revert this situation, in 2006, AHMSA

announced the Fénix project, in reference to a long-lived bird that is cyclically regenerated or reborn, in accordance with Greek mythology. At a cost of $825M, its main objective was to expand nominal capacity to 4.75Mt, implying a 40% increase. The main equipment to be added would be a blast furnace, an EAF, a ladle metallurgy station and a continuous casting machine. In mid-2008, the project’s scope was enlarged in order to include a new plate mill. In December 2008, it was formally suspended, when AHMSA had already invested $760M, equivalent to 54% of its updated budget.

The Fénix project was resumed in 2010, now with the goal of achieving a capacity of 5.5Mt/yr. The capex also inflated to $2.3bn. In 2011, a 1.5Mt/yr blast furnace was commissioned. In 2003 Enrique Peña Nieto, president of Republic, officially launched a 1Mt/yr Steckel mill.

The equipment produces steel sheet and plate of specifications not previously manufactured in Mexico, for uses including production of marine platforms, railroad cars, large liquid containers and Continued 15>

5000 4500 4000 3500 3000

20 15 10 5

2500 2000 1500 1000 500 0 1944

0 -5 -10 50

56

62

68

74

80

86

92

Fig 1 Ahmsa’s crude steel production, 1944-2014 (kt). Source Ahmsa

98

04

10

2009

2010

2011 EBITDA margin

2012

2013 2014Q3 Net profit margin

Fig 2 Ahmsa’s EBITDA margin and net profit margin, 2009-2014 (%). Source: Amhsa

* Professor in economics, Federal University of Uberlândia, Brazil. E-mail: germano@ufu.br www.steeltimesint.com

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14

CHINA UPDATE

China – is Europe a soft touch?

The phrase ‘calling for a level playing field’ is one that senior executives engaged in the production of steel globally probably hear at least twice during an average working day – and more so when they attend a global steel conference. But what can be done? By Matthew Moggridge*

AS China’s economy continues to slow down, there is less demand for steel from China’s infrastructure and construction sectors. This has led to a much publicised and talked about overcapacity situation. In short, there is a lot of steel simply hanging around awaiting export to reluctant recipients in the USA, Europe, South America and elsewhere. These countries are reluctant to welcome Chinese steel with open arms because they have their own domestic steel industries that need all the support they can get and they are all too aware that Chinese steel production is heavily subsidised by the Chinese government and, therefore, far cheaper to produce than metal made by the indigenous steel makers of China’s chosen export markets.

The practice of exporting steel into countries where the domestically produced product is more expensive to produce and buy is known as ‘dumping’ and it is having an extremely negative effect on the global steel industry.

Today, China accounts for almost half of global steel production and is likely to be exporting around 90Mt of metal this year, up from 55Mt just a couple of years ago.

Understandably, those receiving Chinese steel are not happy. The most vocal and reactive recipient of Chinese metal has been the USA, which recently slapped punitive import tariffs on Chinese finished steel products coming into the country.

At a steel conference in the USA last summer, Tracy Porter of Texas-based Commercial Metals Company (CMC) told representatives of the global steel media that he had never seen a more vicious attack on the American economy and that there was a big difference between free trade and fair trade. “Fairness is what we’re looking for,” he said, adding that the USA didn’t want to close its markets.

Mario Longhi, CEO of US Steel, went a

step further when he said that American steel companies had been ‘targeted for elimination’.

Much welcomed and punitive import tariffs followed and ever since then the spotlight has shone on the European steel industry. One big question is being asked.

Why does the EU adopt a less aggressive stance towards the Chinese, despite major steel players expressing their exasperation at an increasingly worrying situation?

An article by journalist Brian Meechan appeared recently on the BBC’s website claiming that Tata Steel and Celsa – both

and ultimately this can only lead to plant closures and job losses.

For Tata and Celsa an influx of Chinese rebar into the UK is the problem. In less than two years it has gone from zero to accounting for 25% of the market and this is peculiar to the UK because its construction market is healthier than most regions of mainland Europe at present.

On a global level, the problem is exacerbated by the wider variety of products now coming out of China. Since 2014 the Chinese have been exporting all types of steel product including long

major employers in South Wales in the United Kingdom – are taking a stand against cheap foreign steel imports, arguing that the practice is causing the industry to stagnate. According to Meechan, cheap imported steel from China is being used instead of UK steel

products, which are not normally exported worldwide.

But what can be done? The answer, it seems, is very little. Compared to the USA, the rules and regulations in Europe governing the dumping of cheap steel from China and elsewhere are significantly

* Editor, Steel Times International March 2015

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www.steeltimesint.com

3/11/15 3:19 PM

CHINA UPDATE

and India, were not viewed as potential threats. How things have changed!

Between the mid-90s and the early noughties tariffs were phased out and today there is no going back as the tariff is no longer a policy instrument.

less practical and effective; and the problem appears to be Europe itself. In simple terms, Europe is much slower to react. In the USA things get done in three to four months; in Europe it takes double that, if not longer.

It is argued that the Europeans are a ‘softer touch’ than the Americans; the penalties for ‘rogue nations’ are less punitive and the problem has its roots in Europe’s open market approach.

In many respects the Chinese problem is relatively new and it was unforeseen.

Import tariffs, for example, were gradually phased out in the mid-90s when emerging economies, such as China, Russia, Brazil

Market economy status?

Whether China should be granted ‘market economy status’ in Europe is another political hot potato. It is argued that it would be almost impossible to stem the flow of Chinese imports should it happen.

Foreign markets are not as open as the EU’s and so that phrase, ‘a level playing field’ raises its head again. Whether Europe has the appetite for engaging in trade protectionism is questionable – although the EU has introduced antisubsidy and anti-dumping measures.

Is there a bright future for steelmaking in Europe? The answer is yes, but only if it is accepted that China and other nations have the economic advantages to play a more commodity-based game and that European steelmakers should focus on building strong relationships with customers and developing innovative, high quality products for sectors such as automotive and construction.

15

In mainland Europe, EUROFER, the European Steel Association, recently criticised China’s ‘trade-distorting’ industrial policies, claiming that they were detrimental to the recovery of the European steel industry.

EUROFER’s director-general Axel Eggert said that the EU must get to grips with ‘foreign’ trade protectionist measures as cheap imports were undermining the level playing field and weakening margins.

That word ‘foreign’ is interesting as while China is widely regarded as the villain of the piece, Turkey is becoming a growing threat; its key export markets in the MENA region are either dogged by armed conflict or, as in the Middle East, developing their own domestic steel industries.

As reported in last month’s Steel Times International, Turkey has an adaptable private sector, an entrepreneurial spirit and prime geographical locations thanks to coastal plants that offer major logistical advantages and cost efficiencies.

Ultimately, of course, the problem rests with the phenomenon of globalisation and that is something that developed and developing economies will have to come to terms with for some time to come. t

<Continued from p13 - Latin America Update

heavy machinery and structures. A plant of 1.6tp/d of oxygen was also started-up in the same year. The improvements made it possible to reach 4.2Mt of crude steel in 2013 (Fig 1).

A 1.2Mt/yr continuous casting machine was brought on stream in 2014, when steel fabrication increased to 4.4Mt. In the same year, AHMSA received equipment purchased at auction from Sparrows Point (an idle steel mill in the USA) with the aim of reinforcing its hot- and cold-rolling lines, which have capacities of 2.4Mt/yr and 1.4Mt/yr respectively. The purchase involved 890 pieces of equipment, but the timetable and gains in terms of installed capacity were not revealed.

The construction of a new 1.2Mt/yr EAF was concluded in January 2015, but commercial operations have yet to start.

AHMSA is amplifying the capacity of its heat treatment line for plates from 200kt/ yr to 300kt/yr in 2015. To guarantee higher production volumes, it signed an agreement with Voestalpine for the supply of 400-650kt/yr hot briquetted iron (HBI) from 2016 onwards, during a five-year contract. After the conclusion of the Fénix project, it is understood that AHMSA will be operating under optimised conditions.

AHMSA was founded to substitute imports in the 1940s, focusing on flat steel www.steeltimesint.com

CHINA UPDATE.indd 2

products. This specialisation continues today. In the first three quarters of 2014, flat steel products were responsible for 83.3% of net sales, followed by thermal coal (10.8%), heavy sections (4.9%) and others (1.0%). Within flat steels, tinplate accounted for 5.2%. The firm longer fabricates galvanised products and is predominantly a domestic oriented company. Only 12.5% of net sales came from exports in 2014.

AHMSA has a high degree of vertical integration. Its mining subsidiaries supply iron ore and metallurgical coal to its integrated mill and thermal coal to the market. In 2013, it produced 7.2Mt of thermal coal, 5Mt of met coal and 4.2Mt of concentrated iron ore. This explains the high number of employees: 22,793 currently.

Financial rebirth Having worked on its productive rebirth, AHMSA seems to be engaged in a financial resuscitation. Under an agreement with creditors, the company will repay 100% of its debts in local currency within three years. Creditors will be able to reclaim part of the money owed through AHMSA’s shares. The total amount is equivalent to $1.7bn.

Looking at financial performance, Fig 2

shows that AHMSA’s EBITDA margin has improved from 12.7% in 2009 to 19.1% in 2011, and then diminished to 5.6% in 2013. In the first three quarters of 2014, this index totalled 7.1%.

Fig 2 also demonstrates that AHMSA’s net profit margin has been relatively low, hovering around 1.8% between 20092011. After a net loss margin of 1% in 2012 and even 7% in 2013, it continued in red ink (0.9% net loss margin) between January and September 2014.

In this context, the company will face a big challenge and the Fénix project should improve the company’s fortunes in quantitative and qualitative terms as AHMSA will have to repay approximately $570M debt per year in a context of depressed international steel prices. t March 2015

3/11/15 3:19 PM

16

INDIA UPDATE

Jindal Steel and Power in dire straits Weak demand and rising imports have hurt Jindal Steel & Power’s Indian operations and the company has reported its first ever loss on exceptional levies by India’s Supreme Court. By Dilip Kumar Jha*

JINDAL Steel & Power Ltd (JSPL), an O P Jindal Group company, is currently passing through a rough phase due to its first massive loss incurred in Q3 FY 2014/15.

Lower capacity utilisation kept its steel and power sales under pressure, and the business was adversely affected by cheap steel imports from China, North Korea and Japan amid a slowdown in demand, which has also affected business. To make matters worse, the Group’s alleged involvement in illegal coal mining in association with some Ministry officials has weakened the company’s credibility.

Severe impact JSPL posted a consolidated net loss of INR16.75 billion ($271.89 million) for Q3 FY 2014/15, compared with a profit of INR 5.59 billion in the same period a year earlier. Net sales of the company declined, albeit marginally, to INR50.45 billion for Q3 FY 2014/15 as against INR51.42 billion. Chairman Naveen Jindal attributed the company’s poor performance to exceptional charges of INR18.55 billion levied after its nine coalfields were taken back by the government. Apart from that, the company’s financial performance was hurt by high raw materials costs as it had to meet a large part of its iron ore and coal needs through participation in open auction sales or imports.

Negative impacts According to JSPL’s chairman Naveen Jindal, the financial performance of the company was negatively impacted for several reasons including low steel demand in domestic and export markets and the consequent decline in steel prices.

Furthermore, he said that continued suspension of iron ore supplies from JSPL’s major suppliers and non-availability of coal for power plants also hit hard.

JSPL commissioned a 2.3Mt/yr billet caster and 175kt/yr heat treatment shop in Angul, Odisha, but its capacity could not

Quarterly performance (INR billion) Financial year (Apr – Mar)

Consolidated

Standalone

Turnover

Net profit

Turnover

Net profit

Oct-Dec ‘14

50.45

(-)16.75

35.41

(-)6.70

Jul-Sept ‘14

51.43

4.00

31.97

2.87

Apr-Jun ‘14

49.78

4.02

35.84

3.06

Jan-Mar ‘14

51.02

4.02

36.86

4.30

Oct-Dec ‘13

51.42

5.59

35.41

3.66

Jul-Sept ‘13

48.52

4.55

35.24

2.57

Apr-Jun ‘13

45.40

5.01

34.25

2.39

Jan-Mar ‘13

56.48

7.60

42.13

4.77

be utilised fully due to subdued demand for flats and semi-finished products.

Meanwhile, India’s top investigation agency – the Central Bureau of Intelligence (CBI) – discovered that the company mined nearly 6Mt of coal despite permission being granted for just 1.5Mt. The CBI enquiry into the Group’s involvement in the aforementioned coal scam is currently underway and, as a result, the company’s net worth eroded by almost 50% over the last year to INR130 billion. Its share price fell by nearly 60% to trade currently at INR 142 ($2.12) a piece.

Expansion in limbo JSPL operates the largest coal-based sponge iron plant in the world with

an installed capacity (steel) of 3Mt/yr alongside a medium and light structural mill at Raigarh (Chhattisgarh state). Also, it has set up a 600kt/yr wire rod mill and a 1Mt/yr capacity bar mill at Patratu (Jharkhand state) and a 2.5Mt/yr steel melt shop and plate mill to produce up to 5-metre-wide plates at Angul (Odisha state).

Plenty going on The company has committed to investments exceeding $30 billion and has several business initiatives running simultaneously across continents. Apart from that, its three mega expansion projects are in various stages of completion: In Chhattisgarh, there are plans to set

* India correspondent March 2015

INDIA UPDATE.indd 1

www.steeltimesint.com

3/13/15 11:15 AM

INDIA UPDATE

www.metec.com www.tbwom.com

17

worldwide

up a 7Mt/yr integrated steel plant in phases, a 2Mt/yr cement plant and a 1600MW captive power plant with an accumulative investment of over $7 billion; in Jharkhand, a 12Mt/yr integrated steel plant with a total investment of $10 billion. For phase one, the company is setting up a 6Mt/yr integrated steel plant and a 1320MW captive power plant. Lastly, in Odisha, a 12.5Mt/yr integrated steel plant at Angul is being planned. Phase one will be a 6Mt/yr integrated steel plant costing $6 billion.

A wide portfolio of products From the widest flat products to a whole range of long products, JSPL today sports a product portfolio focused on markets across the steel value chain. The company produces the world’s longest rails at 121 metres and it is the first in India to manufacture largesize parallel flange beams.

Alongside domestic expansion, JSPL is driving an ambitious global expansion plan with its sights set on emerging as a leading transnational business group. The company continues to capitalise on opportunities in high growth markets, expanding its core areas and diversifying into new businesses. In Oman (Middle East), it has set up a $500 million, 1.5Mt/yr gas-based hot briquetted iron (HBI) plant and has now added a 2Mt/yr integrated steel plant.

Large mining interests The company has large mining interests in South Africa, Mozambique, Namibia, Botswana and Mauritania and is expanding into steel, energy and cement manufacturing units.

In Australia, it is investing in greenfield and brownfield resource sector companies and projects to supplement its planned steel and power ventures in India and abroad. In Indonesia, JSPL has invested on the development of two greenfield exploration assets and is also exploring investment opportunities in Indonesia’s power and infrastructure sectors.

Unfortunately, the executed domestic expansion projects are running with lower capacity and some of the global undertakings are also facing challenges.

Overcoming measures JSPL has taken several measures to overcome the challenges it faces, but it is unlikely that these issues will be resolved soon.

To cut expenditure, the company retrenched 5% of its 15,000 workforce during Q3 FY2014/15. Early February, however, it announced retrenchment of another 750 employees. Apart from that, it has taken other cost-cutting measures to improve its financial performance in the coming quarters.

Jindal believes that the company will bounce back with double digit growth by the end of Q4 FY2014/15 following the government’s positive initiatives to overcome raw materials (coal and iron ore) shortages. t www.steeltimesint.com

March 2015

Strike while the iron is hot The 9 th international trade fair for metallurgy, steel casting and steel production with congresses converts visions into plants and products.

Growth engine metallurgy METEC with its supporting events is the top event when it comes to plants and products for raw iron, steel and non-ferrous metal production.

Welcome to Düsseldorf!

Messe Düsseldorf GmbH P.O. Box 10 10 06 40001 Düsseldorf _ Germany Tel. + 49 (0)2 11/45 60-01 Fax + 49 (0)2 11/45 60-6 68

www.messe-duesseldorf.de

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3/13/15 11:15 AM

18

IRON ORE

Towards cheaper ore?

Michael Schwartz* looks at two distinctly different projects with implications for iron ore pricing.

SEABED mining enjoys mixed fortunes.

Sometimes it is banned altogether, sometimes it is allowed only after strenuous negotiations, and sometimes it is allowed because it can bring tangible benefits.

New Zealand’s North Island harbours substantial black sand deposits which fall into the last category; a major iron ore resource is anticipated from these deposits.

Wellington-based Trans-Tasman Resources Ltd (TTRL) has invested $60 million since 2007 in investigating local black sand deposits, studying the relevant aspects of engineering, marketing, local environment and potential impacts. TTRL’s objective is to develop an iron sands extraction project, which is environmentally sustainable while delivering substantial economic benefits.

Some 22km off the coast of Patea lies TTRL’s initial South Taranaki Bight project, stretching over 65.76km2 under 20-45 metres of water. Matt Brown, TTRL’s general manager, exploration, sets the scene, “The project is currently seeking approval for the run-of-mine production of 50Mt/yr for the production of up to 5Mt/yr of iron sand concentrate over 10 years. The mining and production of the iron sand will be undertaken by a purpose-built integrated mining vessel, using a subsea “crawler” to mine the seabed sediment…”

On 2 May 2014, TTRL received a mining permit from the New Zealand government under the Crown Minerals Act 1991 for the South Taranaki Bight. Separation of the ore from the seabed material will involve gravity and magnetic processes; iron ore concentrate will be slurried from

the mining vessel to a transshipment vessel where it will be de-watered and stored ready for transfer to bulk carriers for worldwide export.

After 10% of the extracted material comprising iron sand concentrate has been exported, the residual sediment will be returned to the seabed via a controlled discharge below the mining vessel, usually backfilling previously extracted areas.

TTRL has compared its operations with traditional drilling and blasting. In the latter, the drilling and blasting are followed by transportation and crushing; in contrast, offshore dredging – a single stage – supersedes all four stages in drill and blast.

Lower costs also accrue as the black sands are, by definition, an unconsolidated alluvial deposit. TTRL uses a base case production scenario of 4Mt/yr, with typical +/- 30% standard deviation.

The capex estimate is $580 million. In turn, TTRL calculates that the absence of overburden will mean very low opex, namely $29/t-$32/t, based on estimated production throughput scenarios but before marketing and royalties. TTRL also anticipates low capital costs because its operations are not subject to infrastructure bottlenecks such as deep sea ports or heavy rail.

Conventional operations?

Jimmy Wilson, BHP Billiton’s president (iron ore), whose views on iron ore costing were quoted in this column last month, announced a strident strategy for lowering the cost of Western Australia Iron Ore (WAIO) with the collective targets of: • FOB unit costs at less than US$20/t medium term;

• less sustaining capital investment than BHP Billiton’s competitors; and • potential to add 65Mt of capacity at a capital intensity of approximately US$30 per annual tonne.

Wilson certainly has one advantage: the Pilbara iron ore resource has tripled over the last seven years to 23 billion tonnes including 3.7 billion tonnes of reserves. In all, this resource will support BHP Billiton’s iron ore mining for over a century.

More directly related to cost reduction, BHP Billiton states that its “ore bodies underpin low-cost operations” because of a low strip ratio of 1.3x at locations primarily above the water table. BHP Billiton’s drive for lower costs is further enhanced by the geographic concentration of its major mining hubs – all four existing operations are not more than 150km from one another – and it will be 30 years before any new mining hub is required and eight years before any new mine.

Wilson is keen to stress a “relentless focus on costs.” The almost $30/t cost in FY12 fell to $27/t in FY14; the FY15 estimate has fallen to under $24/t. Over five years, the average sustaining capital expenditure is expected to be around $5/t, boosted by the concentrated resource footprint already mentioned.

BHP Billiton envisions healthy demand growth for iron ore as Chinese steel production is expected to increase by roughly 25% between now and the earlymid 2020s. A challenge has come from new entrants as recent high prices have created incentives for them.

Jimmy Wilson’s aim is to make BHP Billiton’s WAIO the lowest-cost supplier to China. t

* Mining correspondent March 2015

iron ore.indd 1

www.steeltimesint.com

3/11/15 9:35 AM

19

NEW YEAR PREDICTIONS

A poor year for pricing power Asked for her global steel industry predictions for 2015 Becky Hites* of USA-based Steel-Insights believes it will be a good year in terms of production, but there will be no pricing power, making it a poor year in terms of earnings.

1. How is the global steel industry shaping up for 2015?

There is a significant overcapacity globally in both long and sheet products that will persist throughout the year.

We are now at the bottom of the latest commodity pricing cycle, with gold prices topping in 2011, industrial metals topping in early 2012, grains topping in late 2012, and oil pricing topping in the summer of 2014.

The raw material steelmaking costs have dropped dramatically for integrated steelmakers, but not as much for EAFbased steelmakers, which has provided some price support at higher levels than would have been expected. Recent currency swings have reduced steelmaking production costs in Russia to perhaps 60% of USA mill production costs. When Chinese steelmaking growth was strongly outpacing the ability of raw material suppliers to keep up, steelmakers around the world were all faced with similar challenges. Now the global steelmaking world is no longer homogenous; the continents have been broken apart and, like icebergs, are facing independent currents and challenges.

2. How do you think steelmakers will be approaching 2015 – with caution and pessimism, with boundless enthusiasm and optimism or somewhere in between?

On the supply side, there is no doubt that there is excess available steel supply in almost every geographic market and in every finished product category. So the question comes down to one of demand strength.

Despite indications of decent demand in most markets, steelmakers will likely be very guarded with regard to the 2015 outlook. An exception to the strength in steel demand is energy applications, where demand is reeling from Saudi Arabia’s decision not to reduce production to allow absorption of increasing US production in recent years, arguably to recalibrate the financial industry which, until now, had discounted the possibility of a falling price environment, and was providing “easy” money to all energy-related projects, regardless of their viability. It’s speculated that as soon as the bankers adjust their funding criteria, the KSA will cutback oil production and allow prices to rebound.

The overall global economy is expected to post 2% plus growth in 2015, but it won’t be a rising tide for all boats.

There will be parts of the world with flat GDP performance and even contraction.

The European Union (EU) economies remain fragile due to the debt overhang in Greece and now speculation on the future of the Euro with the Swiss Franc break.

European Central Bank (ECB) actions to stimulate the EU economy will be a positive, and arguably an appreciation of the currency is necessary for the EU economies to recover from the 2008 collapse.

The Russian and Ukrainian economies are headed into recession and are likely to remain in a political quagmire.

Dropping oil prices mean that the MENA economies have gone into cardiac arrest and will likely remain in limbo for most of the year.

China’s growth has slowed dramatically – more so than targeted – and we believe the government will shift back to stimulating both the banking

Steel-Insights

Steel Insights, founded by Becky Hites in 2012, is a boutique consulting firm focused on providing highly specialised services to clients in the metals, mining and manufacturing industries.

system and perhaps even manufacturing through fixed asset investment. It will likely be an “okay” year in retrospect, but it will be one that feels like “shingles” – with persistent pain and discomfort.

3. Is 2015 going to be a good or a bad year for the global steel industry?

We are forecasting 2% growth in global crude steelmaking for 2015 over 2014, weighted toward the developing world economies. The colonial model of the developed world supplying steel to the developing world has been eclipsed and is gone forever. China, and other developing countries, have gotten more accomplished at turning out higher valueadded steel items and, we hear, produce and effectively supply even wide, thin, cold finished products to consumers in the northeast corridor of the USA. We are looking for 1.1% growth in crude steel production in the developed world, including 2.5% in the USA and 1.2% in the EU, offset by a flat performance in Japan.

For the developing world, we are looking for a 2.5% increase in crude steel production in China; a 3% increase in India; a 5% increase in South Korea; a 5% increase in Russia; a 15% decrease in the Ukraine (due to transportation disruption); a 4.4% increase in the CIS; a 3% increase in Turkey; a 2.3% decrease in South America (due to currency challenges in Brazil); a 0.3% decrease in Africa; and a 2.5% decrease in Oceania.

So in terms of production, it will be a good year. But there will be no pricing power, so in terms of earnings, it will very likely be a poor year. t

* Founder, Steel-Insights, LLC www.steeltimesint.com

Steel insights.indd 1

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3/11/15 9:39 AM

Pagine 2013 A3 esecutivi 2013_08_08_qxd8_A3 esecutivi 14/01/14 10.12 Pagina 25

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Pagine 2013 A3 esecutivi 2013_08_08_qxd8_A3 esecutivi 14/01/14 10.12 Pagina 25

DANIELI CENTRO COMBUSTION ULTRA-LOW NOX HEATING SYSTEMS FOR AN EFFICIENT AND SUSTAINABLE STEEL INDUSTRY

State-of-the-art direct and indirect firing, controlled atmosphere heating systems, covering a wide range of industrial furnace applications from reheating to heat treatment processes for steel, aluminum and copper production.

> Temperature uniformity 10 °C > Oxidation < 0.5 % > Emission level 30 PPM

Four significant references out of total 238 VALLOUREC & MANNESMANN Projects including reheating furnaces and four heat treating furnaces with direct and indirect firing systems by means of high-waste gases recirculation fans, completed with in-house developed quenching system for pipes O.D. ranging from 4 to 16”.

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Danieli Headquarters 33042 Buttrio (Udine) Italy Tel (39) 0432.1958111

ACCIAIERIA ARVEDI ITALY Latest generation vertical furnace for DP and TRIP steel strip equipped with proprietary premix burners, self-recuperative burners in 2P Inconel radiant tubes and rapid cooling in controlled atmosphere up to 110 °C/s.

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22

CONFERENCE REPORT: CRU NORTH AMERICAN STEEL

Production, prices and products under There was plenty to discuss at CRU’s recent North American Steel Conference in the windy city.

Hans Mueller* braved a cold and breezy Chicago to report on the event for Steel Times International COLD and breezy Chicago once again was the venue of a North American (NA) steel conference, held November 10-12 and organised by the British CRU consulting company. As is customary at these events, some of the more analytical presentations were made by some of the CRU team, most of whom had come over from Britain. Not counting speakers and session chairpersons, 112 delegates attended the conference. They included five from Canada, two from Turkey, and one each from France, Korea, and Liechtenstein.

Due to the wide variety of topics offered at this conference, it was probably inevitable that a few made a less than perfect fit for the sessions into which they had been placed. To improve the topical relevance of some presentations relative to others grouped under the same subtitle, this writer performed some minor re-ordering in the sequence in which they were reviewed.

Two mill experts and a consultant M Bula of Big River Steel gave a detailed account of the gestation and capabilities of the first phase of a new flat-products “minimill” built in the US state of Arkansas.

He emphasised that the addition of a degasser to the mill’s second construction phase would enable the company to offer grain-oriented electric steels as well as advanced, high-value products traditionally made by integrated mills.

M Obermire talked about USS-Posco Industries, a steel plant with a deep-water harbour based in California. The mill converts hot bands received from both its parent companies into hot and coldrolled coils, tinplate, and coiled plate. Its principal markets are the construction and manufacturing industries along the west coast and in adjacent inland states.

However, the company faces strong competition from imports, which in some product lines meet almost 50% of local demand.

K Shah, of Roland Berger Strategy Consultants, criticised the “flawed conventional wisdom” of steel company managers who, he maintained, were overly concerned with capacity utilisation (‘fill the mill’), even if it meant cutting prices. Because Mr. Shah glossed over a predominant concern of many NA steelmarket participants, the presence and actions of competitors, his talk was of

CRU HR coil prices, local markets, nominal USD/t 900

limited relevance to the topics discussed at this conference.

Steel production, steel trade and trade lawyers J Spoores of CRU offered a positive view of global demand for flat-rolled steel during the next five-year period, except for regions facing political problems.

For the growth of global apparent net consumption from 2015-19 he projected a CAGR of 2.7%; for NA he put the rate at 3.1%. After 2015, construction would again become the strongest steelconsumption sector, he added. US sheet prices would weaken a bit next year, then move to a slightly higher average. Further consolidation among US producers and their expertise in the application of trade laws would help forestall price erosion.

Elizabeth Johnson, also of CRU, arrived at similar conclusions regarding the US industry’s long-product sector. A high concentration ratio plus well-honed price discipline have enabled US long-product mills to keep prices above those charged by major foreign competitors. This premium, she noted, will remain intact but suffer some compression due to falling

Hot strip mill capacity, Mt 30

USA Midwest

Germany

China

Average

Prior

25

800

Acquired

20 15

700

10

600

US prices remain an outlier to global price weakness. Data CRU

Se p t1 4

Jul 1

4

4 y1 Ma

14 Ma r

3

14 Jan

v1 No

3 Sep t1

3 Jul 1

3

y1 3 Ma

Ma r1

Jan

13

5 0 ArcelorMittal

AK Steel

Steel Dynamics

Nucor

Recent mill consolidation will support sheet prices through the 2019 forecast period. Data CRU

* North America correspondent March 2015

CRU CONFERENCE.indd 1

www.steeltimesint.com

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r

23

discussion in the Windy City ore prices, currency shifts, slow demand growth and a large amount of excess capacity weighing on the global market.

An increasing amount of US imports had been caused by elevated domestic prices and strengthening US demand as well as by the efforts of foreign producers to put their excess capacity to use. In particular, a number of Chinese mills had expanded capacity well ahead of their country’s needs. Even so, Ms. Johnson observed, by Q4 of 2014 US import penetration was still low by historical standards. Furthermore, she expected that ‘pressure from Chinese exports should slowly start to ease’.

The important role played by China in the global steel market is sufficient reason for including a presentation about the prospects facing that country’s industry.

K Bai of CRU saw China’s producers struggling with issues that to some extent had grown out of past neglect. He suggested that forceful measures would henceforth be required to reduce air pollution, consolidate industry structure, deactivate obsolete capacity, place greater reliance on market forces and, additionally, shift the focus from fixed investment to consumer goods and from production volume to value-added products.

R White of ISSB Ltd provided a good overview, plus an excellent graphical display, of the direction and intensity of international as well as inter-regional Mt

2000

1500

2013: 19% above 2007 2019: 10% above 2013 2019: 31% above 2007

1000 970

1148 1063

steel trade. As did several speakers at this conference, he drew attention to the recent increase in Chinese exports and the problems this is likely to cause in the markets of other nations.

With three US trade lawyers on the panel, the discussion of international markets and trade soon narrowed in on trade law enforcement. It would have been interesting also to have a US steelconsuming company represented on the panel, for example a company that— following a trade case—had been cut off from critical supplies not available domestically. Or a company that, unable to pass through to its customers the higher steel prices imposed after a trade case, had suffered a sharp reduction in its profits.

Although largely devoid of economic rationale, the trade law has provided an effective method for keeping troublesome imports out of national markets (sometimes as long as 15 or 20 years). But its application often had secondary effects, such as the disruption of traditional supply chains in both exporting and importing countries. The law is strictly designed to serve the interests of producers; it disregards those of related industries as well as the national interest. In several instances, it has lent itself to protectionist abuse by politically influential groups of producers.

D Pinkert, of the US International Trade Commission, briefly described the shift in targeted imports between two periods of intensive litigation, 2001 and 2014.

Recently it was especially foreign exporters of steel pipe, so-called “oil country tubular goods” (OCTG), that were accused of unfair practices by their US competitors.

M Nolan of Arent Fox reported about his experience as defense lawyer for Turkish exporters, mentioning in his account several examples of the bizarre manner in which officials of the US Commerce Department interpreted trade law language.

A Price of Wiley Rein shot a barrage at foreign steelmakers, denouncing them for being subsidised, selling in US markets at unfairly low prices and cheating on the corrective orders imposed on them, remarks that closely resembled the rhetoric circulated by steel-industry publicists for nearly four decades. He followed up with some well-worn criticism of China’s economic policies. A fourth panelist, P Navetta, a sales manager with a Brazilian steel company, showed limited familiarity with trade law issues.

Futures, pricing, raw materials Futures and pricing was the title of a panel that included representatives of two service centres and a large commodity trader.

They were P Price of Stemcor, N Webb of

forecast

of which China

17171746 1772 16331661 1689 153715591607 1433

1348 1343 1250 1238

500

0

03 04

05

06 07

08 09 10

11 12

forecast 13 14 15 16 17 18 19

Global crude steel production. Source: 2003-2013 World Steel Association.

Source: 2014-2019 BREE/WSA/ISSB Analysis

www.steeltimesint.com

CRU CONFERENCE.indd 2

Major regional steel trade flows January to June 2014 versus January to June 2013

March 2015

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3269_15-CMI_Metals_Ann A4.indd 1

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CONFERENCE REPORT: CRU NORTH AMERICAN STEEL

Bulk raw material prices, $/t, FOB Australia for hard coking coal; CFR China for iron ore

900

Rebar prices, $/t US

450 400 350 300 250 200 150 100 50

Iron ore

Hard coking coal

25

China

Germany

800 700 600 500

Prices are now much lower – back towards “pre-boom” levels

4

4

Sep 1

Ap r1

3 Jun e1

2 Au g1

1 Oc t1

0 De c1

0 Feb 1

Ap r0

9

8 Jun e0

7 Au g0

Oc t0

6

0 400 12Q1 12Q3 13Q1 13Q3 14Q1 14Q3 15Q1 15Q3 16Q1 16Q3 17Q1 17Q3 18Q1 18Q3

The premium that US long products prices attract will narrow slightly in the medium-term.

Data: CRU’s steel long products market outlook

Ryerson, and T Stevenson of Cargill. Other panelists were Youngjin Chang of the CME Group and D Dunn of SSY Futures Ltd. Much of the talk was about the benefits of futures: let executives focus on what they do best, making or trading things, and free them from worrying about price volatility. But as N Webb of Ryerson pointed out, for a company to operate efficiently its key executives must be skilled in the use of derivatives. D Dunn would like to attract more service centres. He also noted that futures were popular with the iron-ore industry, but more education was needed to make progress with scrap dealers and buyers.

R Osterholm of SunCoke was the first speaker in the raw materials session. In addition to constructing highly efficient non-byproduct (heat-recovery) coke ovens for steelmakers in the USA, Brazil, and India, SunCoke has a large coal logistics business – which includes freight hauling by rail, barge and truck as well as the operation of terminals. The company is also looking for opportunities in ore processing and the construction of DRI plants. Patricia Mohr, of Scotiabank (Toronto), spent much of her time talking about China which, she claimed, is getting more serious about small farmers moving into cities and government-controlled enterprises accepting private investments and paying more dividends.

She added that auto sales in China exceeded those in NA and that more intensive use of galvanised sheets in Chinese vehicles would considerably raise the demand as well as the price of zinc in 2015. According to P Butterworth of CRU, metcoal is one of the worstperforming commodities and many producers are losing money. Except for shipments to Europe and Latin America, total US exports are likely to weaken. Over the medium-term global metcoal prices will improve slightly, whereas iron ore prices will continue on a downward path.

CRU zinc specialist G Deller made clear that zinc was being used up at a faster rate than mines were able to produce it.

Accumulated stocks will stave off severe www.steeltimesint.com

CRU CONFERENCE.indd 3

shortages until 2019, but some rationing may have to be imposed as early as 2016.

Future market conditions will, to a large extent, depend on China, which controls a third of global mining output.

Major US and North American steel product markets Automotive: R Hilgert of Morningstar, Inc., predicted a slight increase in the sale and production of light vehicles (cars and small trucks) in the USA and NA due to the advanced age of vehicles in operation, improved consumer finances and confidence, and declining fuel prices.

Incidentally, the predictions for NA vehicle output and sales made at several previous Chicago conferences turned out to be on the low side¹.

Construction: K Baker of the American Institute of Architects looked at the future of residential and non-residential construction in the USA. Both were badly affected by the 2008/09 downturn and in subsequent years their share of GNP declined noticeably. Housing prices have meanwhile recovered 60% of their losses.

Although new home starts are expected to rise sharply, they will remain far below the level they had reached before the downturn. The institutional sector (hospitals, schools, etc), which accounts for more than half of non-residential construction, has staged only a modest recovery. By comparison, the commercial sector took the steepest fall during the malaise but also enjoyed the sharpest rise in recent years.

Plate and tubular products: These markets were examined by a panel of three experts. Christine Ovsenar of SSAB – a company with operations in Sweden, Finland and the USA – provided an overview of the strength of demand for plate in such applications as tubular products, storage tanks, railcars, wind turbines and transmission towers. Except for storage tanks, these sectors show a weak trend at this time.

P Vivian of Preston Publishing

Co. estimated 2014 OCTG demand (comprising nearly a third of all tubular consumption) to expand at a strong 13.5% rate. He expected line pipe demand, which is half the OCTG volume, to contract by 10.8% in 2014 due to weather and crewing problems, but to strengthen in 2015. Mr. Vivian also noted that OCTG usage had seen considerable productivity increases in terms of wells drilled and that operating at greater depth called for higher-strength steel.

Regarding trade litigation, he estimated that recent affirmative ITC decisions with respect to OCTG will eliminate nearly 1 Mt of imported material from the US market.

B Higgins of Macquarie Bank commented that a very cold winter as well as NA power companies switching from coal to natural gas (NG) would help reduce the present NG surplus. Furthermore, in his opinion, crude-oil prices in the USA had become disconnected from global markets due to the rapidly changing situation in the US energy sector.

Purchasing and transportation topics M Dykstra of Dover Corporation, a large diversified buyer of steel products, talked about his company’s plans to leverage its market power by centralising the purchases of its many subsidiaries. He was concerned about future steel prices, should US producers manage to achieve higher levels of capacity utilisation. And finally, J Starks of FTE Associates explained that the US lorry industry was operating near the limits of its capacity, especially for flat-beds, and that orders for new vehicles were at a high level. Moreover, he worried that strict controls imposed by government authorities on the hours drivers were permitted to spend behind the wheel amounted to the virtual reregulation of the industry, which had already led to a serious driver shortage in the USA. t References

1. Steel Times International, March 2012, p39; and March 2011, p46 March 2015

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CONTINUOUS CASTING

27

A metallurgical view of casting Continuous casting is by far the most common way of solidifying liquid steel made by either the BOF or EAF steelmaking processes. It is the replacement for ingot making, producing higher yield and also superior surface and internal quality. A description of the process and its metallurgical considerations are given in this article. By Keith Walker * IT is sensible to give a short overview of the casting process at the outset, since some readers may not be familiar with it. At the end of steel making, up to 350 tonnes of liquid steel is ready to be cast from a steel ladle (a refractory lined steel bucket). The steel is poured from the ladle through a hole in the base, secured by a tap known as a sliding gate nozzle such that the steel can be released when required without danger of it leaking out beforehand, with a high level of control of the flow rate.

The caster usually has more than one mould and so it is necessary to transfer the steel firstly from the ladle into a distributor known as a tundish. This is positioned under the ladle, and then the ladleâ&#x20AC;&#x2122;s sliding gate is opened to fill the tundish.

The tundish also has similar sliding gates in its base, in order that the steel can then be poured into the moulds in a controlled way.

The moulds are made from copper, are water-cooled and usually no more than a metre in length. During casting, the steel is withdrawn from the moulds and contained by steel rollers with water sprayed onto the surface. The strand (as the solidified steel is known) is not fully solid at exit from the moulds, but is a solid shell with partially liquid steel within it. Solidification continues as the strand moves down the machine until it is completely solid, and can then be cut off into manageable lengths for rolling downstream.

At the start of casting, it will be clear to the reader that the liquid steel would simply run straight through the short mould if something were not done to prevent this, so a device know as a dummy bar is first placed into the mould, being an exact fit. The first steel is poured on top of it, held in the mould until calculations show that it has a sufficiently thick solid shell, and then the strand is pulled downwards.

So to summarise, casting takes place by teeming steel from the ladle into the tundish from which it is teemed into the moulds, the number of these being variable but up to eight in the case of billet

casting. It is quicker to use more than one mould, but it depends on the cross section being cast.

To return to the start, the temperature of the steel in the ladle is carefully controlled to an optimum level. This level is a compromise, which allows enough time to cast the steel before it solidifies in the ladle, while also minimising the temperature. Since the solidification temperature depends on the chemical composition of the grade being made (especially the carbon content), the aim

is a certain level of superheat. This means how much higher the temperature is than the solidification point, and will vary from plant to plant, usually being around 30 degrees C. The reason for desiring the lowest possible superheat is that higher ones tend to encourage the formation of segregation within the cast strand. Segregation is a natural process whereby the steel, which is last to solidify, (which is at the centre of the strand as may be expected) contains a higher level of the alloys in the steel than the surface. The usual elements of concern are carbon and sulphur, which if

severely segregated can cause problems which may not become apparent until processing way downstream, even when customers use the steel (for example during welding or wire drawing). For this reason, most steel makers use a range of metallurgical testing to ensure fitness for purpose.

Preventing oxidation When the steel is teemed from the ladle into the tundish, it is usual for the stream of steel to be contained within a hollow refractory tube, which is submerged in the liquid steel in the tundish and securely fastened at its other end to the sliding gate nozzle. It is common to introduce an inert gas, such as argon, into the tube under a positive pressure to exclude air.

The purpose is to prevent oxidation of the steel during teeming, which can lead to the formation of small particles of oxides (eg: aluminium and/or manganese oxides, both of which elements are commonly added to the steel). Such particles, known as inclusions, can cause problems with the quality of the final steel product.

Since a similar thing could happen to the steel while being poured from the tundish to the moulds, similar tubes are often used here as well, although at smaller cross sections there is not room in the mould for such a tube to be submerged in it, and alternative arrangements are made.

On top of the tundish is a powdered material which is layered on, partly to reduce the lost of heat by radiation (allowing a lower superheat to be used), but also to entrap and retain any inclusions in the steel, which are inclined to float upwards. For this reason the powdered material is designed to melt in order that it can absorb such inclusions.

Similarly, a powdered material is also added to the steel in the mould, although in this case it has an additional purpose, which is to melt and run down between the steel strand and the mould to provide lubrication. (Note that in some casters oil is necessarily used as an alternative).

Such lubrication is necessary to prevent the steel sticking to the mould, which

* Steel consultant. Email keith.walker@steelfolk.co.uk www.steeltimesint.com

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CONTINUOUS CASTING

during casting is made to reciprocate up and down for the same reason. It is not necessary for it to move very far, but the design and maintenance are important.

Stirring the steel in the mould One of the things that can help to prevent the segregation mentioned earlier is stirring the steel in the mould during casting. The stirring effect reaches further down into the strand than just the length of the mould, and is achieved by using an electromagnetic coil positioned around the copper mould. (EMS stands for electromagnetic stirring).

It is also possible to stir further down the strand, and even to do it length-wise, but this is less commonly used and reserved for special steel grades.

The copper moulds are usually shaped such that the strand is cast with a radius and emerges curved, with the inner radius upwards. It is not always the case because this can cause problems as will be described later, but if the design is correct it permits the plant to be contained in a building which is not so high, avoiding the need for high capital spend on either a tall building or one with a deep pit. It also has the advantage that the strand ends up horizontal, rather than vertical, making handling of the cut-off lengths easier on roller tables.

Note that the moulds are also tapered to allow for the contraction of the steel as it moves down, so keeping tight contact, but since different grades contract at different rates, the amount of taper is a compromise.

So, the steel emerges from the mould and is contained by rollers pressed against the strand surfaces by hydraulic pressure.

It is not uncommon for more than 30 sets of rollers to be required to cover the length of strand needed before it is completely solidified. Contained, because the head of partially liquid steel within the strand could otherwise cause the solid shell to bulge further down. Such bulging causes all manner of issues, but the more insidious one is segregation. If only one of the many rollers is out of alignment or under too little pressure, the strand will bulge and then be forced back into shape by the next rollers.

Why does it matter, then? The author has been careful to state that within the strand shell is partially liquid steel. It is only completely liquid for a little way below the mould (Fig 1). For the rest, the cross section contains progressively more solid towards the surface, but it is not so simple as an interface between solid and liquid steel. Steel solidifies by forming a network of solid steel within a matrix of liquid, such that there is effectively a lace work structure with a decreasing amount of solid towards the centre of the strand.

March 2015

k walker.indd 2

The liquid fraction contains a higher concentration of alloys than does the solid fraction, this natural effect being the root cause of segregation.

If the strand bulges, the liquid fraction forms channels in order to flow into the part of the strand that is bulged and, therefore, has a higher cross section than the rest. These features of segregation persist even if the strand is forced back into shape further down the machine, and in fact additional channelling occurs when 100 Hot ductibility % RofA

28

20

750

800

Fig 1 Fig 2

950

Temperature/C (of strand surface)

Mould exit

Strand surface Casting direction

L: All liquid L+S: Liquid & solid S: All solid

the strands are reformed. What would have been very evenly distributed, small areas of segregation at the microscopic scale are now macro features and will cause problems downstream.

For this reason, metallurgists insist on what appears to be fantastic accuracy of the alignment and maintenance of the rollers, considering the casterâ&#x20AC;&#x2122;s size.

Millimetre alignment is required, especially on wide cross-section strands, which are more prone to bulging, and indeed are usually used for making plates, in which segregation control is a major issue.

Some casters have a design such that the rollers purposefully deform the strand in a controlled way in order to minimise segregation. No bulging is permitted, of course, but carefully applied deformation is helpful. Such systems are often called soft reduction and in some cases, it is possible to control it dynamically according to factors such as casting speed, which varies according to a number of factors.

Alignment and maintenance of these systems are even more critical, however.

It was explained that the strand is often cast with a curve, and so it has to be straightened before being cut off to lengths for the rolling millsâ&#x20AC;&#x2122; use. This is achieved using a special set of rollers, which are set in a position far down the strand where the unbending is unlikely to cause segregation problems. However, the unbending operation has other hazards.

The principal one is surface cracking.

Clearly, the inner radius must undergo some deformation as straightening proceeds, and at this point the surface of the strand is still in the region of 800 degrees C. Unfortunately, some grades of steel, especially the most common ones containing aluminium, have poor ductility around this temperature. This is due to the formation of tiny particles of nitride of aluminium, which prefer to nucleate on the boundaries between the solid crystals of steel known as grains. This weakens them and cracking can occur. Surface cracking can make it necessary to remove the strand surface before rolling, using flame scarfing or grinding operations.

It is practical to reduce the level of nitrogen in the steel, but the effect is minimal unless impractical low levels are achieved. However, by good fortune, the effect of the nitrides of aluminium are worst at a certain range of temperature, known as a ductility trough (Fig 2). If the casting speed can be controlled such that straightening happens when the strand surface temperature is outside this range, cracking can be reduced considerably.

Sequences The cast strands are finally cut off by a flame torch, which moves at the same speed as the strand, travelling as it cuts.

It is worth noting that it is possible, and very common, to cast many heats of steel one after the other, known as sequences.

Due to the tundish arrangement, it is possible to finish a ladle of steel and bring up another before the steel in the tundish has all been teemed into the moulds, and for this reason a large capacity tundish is desirable. The heats in the sequence are usually all the same grade, otherwise there is an undesirable amount of mixed steel being cast meeting neither specification.

Finally, note that the most common approach to continuous casting of steel has been described in this article, that being copper moulds of rectangular or square cross-section. There are variants to this, the most notable being the use of a cross section called a dog bone, which is part way towards a rolled H section and which reduces the amount of rolling required when making shapes. There are also types of caster, which are almost completely different, but they are far less common and couldnâ&#x20AC;&#x2122;t all be described here. t www.steeltimesint.com

3/11/15 9:49 AM

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31

Fig 1 Ladle turret of caster at Rourkela Steel Plant, India

Wireless signal transmission for the ladle turret on continuous casters The implementation of a wireless control system on the turret ladle exchange of a continuous caster at the Rourkela Steel Plant – to replace a slip ring and hard cabling system – has provided greater reliability, faster response times and less returned steel resulting in a saving of around US$400k a year due to improved productivity. By I Banerjee*, B N Ghosh*, B K Prasad*, A Prasad*, A Goswami*, V Kumar*, S Singh*, D P Sangramsingh**, R P Panda** & S K Sahoo**

THE continuous casting machine at Rourkela Steel Plant, India (RSP) is equipped with a turret which can hold two ladles (Fig 1). The turret is rotated to exchange an empty ladle with a full one every 15 to 20 minutes. Originally, the electrical signals to and from the turret were routed via an assembly of slip rings located inside the turret well. The slip rings were inaccessible during casting and any breakdown of the control cable/slip ring

necessitated stopping casting resulting in loss of production.

The turret can rotate 360° and is interlocked to the caster components via electrical devices mounted on the turret.

Feedback of the turret arm position is provided by limit switches mounted inside the turret well. The ‘Arm up/down’ command is issued by a PLC, activated by proportional valves mounted on the turret. Each arm has load cells to monitor

the weight of the steel in the ladle. All the digital and analogue signals are routed to and from the turret via a slip ring and brush assembly consisting of 50 rings. A drop in control signal strength due to the long length of the control cables from the sensors on the turret to the PLC in the control cabin added to the inaccuracy in the turret weighing system.

The former slip ring assembly on the turret is shown schematically in Fig 2.

*Research & Development Centre for Iron and Steel, SAIL, Ranchi, India **Rourkela Steel Plant, SAIL, Rourkela, India Contact: indranil@sail-rdcis.com www.steeltimesint.com

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CONTINUOUS CASTING

Slip ring assembly inside turret well 50 Slip rings Radio transmission unit on turret To proportional valve

From limit switches DIs

DOs

AIs

DIs

DOs

AOs

To load cells Arm up/down command Limit swtich status to PLC

Amplifier card

Gross Wt 4-20mA

Limit switch Multi core control cable

Valves Junction box

Fig 2 The former system requiring 50 slip rings has been reduced to four rings

Objectives To overcome these inaccuracies, a wireless signal transmission system was developed at SAIL’s RDCIS laboratory.

All the signals from the turret were to be transmitted via wireless mode.

One modem was to be placed on the turret and the other in the control room.

Signals from sensors were to be wired to the modems at the turret and the control room. After receiving the signals reliably, a suitable algorithm would be incorporated into the existing PLC to read the signals and use these for control and display purposes. This approach for signal transmission is valid for any rotating equipment throughout industry.

Implementation Various technical papers were referred to gain knowledge on industrial wireless applications, protocols, frequency hopping techniques, time division multiple accesses and so on1],[2],[3]. A new system capable of transmitting all of the digital and analogue signals to and from the turret was then developed jointly by RDCIS and RSP. The new system was developed with a threefold objective: • Enhance the accuracy of the ladle weighing system to reduce unwanted dumping of steel or require the return of steel; • Eliminate production loss due to breakdown of the slip ring assembly/ control cable; and • Develop expertise in wireless signal transmission technology.

The system comprises two radio modem transceivers, weighing controllers, hydraulic valve amplifiers, (PLC) and special dust proof panels. The application software was developed in-house.

This wireless control has now been in March 2015

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PLC

Load cells

Molten steel

Fig 3 Configuration of wireless transmission stations at the turret (left) and control cabin (right)

continuous operation since March 2012 and is believed to be the first of its kind in India.

A challenge was to retain the limit switches, proportional valves and ABB supplied load cells while incorporating the Radio Modems and Remote Terminal Units (RTUs) on the turret and in the control room.

The limit switches on the turret already output digital signals which were wired to the wireless remote transmission unit (RTU) via input/output (I/O) connections mounted on the turret panel from where they were transmitted to the base station.

These signals received in the base station were wired to the existing PLC as digital inputs (DIs).

The proportional valves and load cells were more challenging as they operated on signals incompatible with wireless transmission. The proportional valves operated on 200mA and 800mA levels and the load cells on a 1.8A 80Hz AC signal.

Amplifier cards which operate on digital inputs and create the desired milliamp output were used to take care of the operation of the valves. Digital Output (DOs) from these were generated in the PLC, then taken as input to the RTU in the main control room (MCR) wireless station from where they are transmitted to the turret panel. The outputs of the RTUs in the turret panel were wired to the amplifier cards mounted on the turret panel. Milliamps generated by these cards were wired to the respective proportional valves.

The turret load cells were of the ABB ‘Presductor’ type. These act on the principle that the permeability of magnetic material changes under mechanical load. These load cells operated on 1.8 Ampere 80 Hz excitation current and output is 0-500 millivolt 80 Hz. Cables from individual

load cells were wired to a local junction box on the turret. A dedicated controller[4] from ABB supplies the load cell excitation current and this was able to convert the load cell output to 4-20mA suitable for wireless transmission. Once the milliamp output was received in the control room at the RTU it was taken as an analogue input to the PLC. This signal indicates the gross weight of the ladle + metal content + weight of cover + weight of skull.

The PLC software was written to provide the weight of molten metal only as an analogue output from the PLC and sent to a large display board mounted on the roof of the MCR. Two wireless panels were used. One stationed on the turret and the other in the control room (Fig 3). The frequency of the wireless modem selected was 865 MHz. and an Omni antenna of 2 Decibels (db)[5],[6],[7],[8],[9] was used at both stations for signal transmission between the PLC and turret. Some laying of new cables was required to bring all the signals to the panel on the turret from the various junction boxes inside the turret well.

Only four slip rings as compared to 50 previously are now used.

An uninterruptible power supply (UPS) was routed via the slip rings to supply the electronic equipment mounted on the turret. This supplied the radio equipment, valve cards, and controllers for load cells.

A non-UPS supply was connected to the panel light and air-conditioner (AC).

Once the signals were received in the control room they are routed to the PLC for further processing. The limit switch signals create the necessary interlock for the turret and tundish movement.

Digital outputs generated in the PLC are transmitted to the turret station and wired to amplifier cards to generate the essential milliamps for the proportional valves which move the turret arm up and down. www.steeltimesint.com

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CONTINUOUS CASTING

Technological benefits are: • Better availability of continuous casting machine because of improved trouble shooting features; • Enhanced accuracy of the ladle weighing system has enabled the ladle slide gate operator to open or close the ladle more precisely, thereby improving steel production; • Enhanced reliability of digital signal transmission; • Reduction in metal loss and chances of slag going to tundish.

Financial benefits are: • Improved tonnage of crude steel produced; • Reduction in the amount of returned steel. Returned steel is undesirable in any continuous casting shop and is the outcome of unpredictable caster stoppages.

• Financial saving in the order of Rs 25 million per annum (US$405k) due to increased steel production and less steel returned to the steel shop for reheating; • Benefit to cost ratio is approximately 4.0:1.

Development of expertise: • A large degree of experience has been developed in RDCIS SAIL on wireless transmission which has enabled SAIL to embark upon many ambitious projects involving wireless signal transmission in hazardous locations.

Safety: • Previously, technicians had to enter the turret well to troubleshoot any problem in the slip ring assembly or the associated control cables. Now, the technicians do not have to enter the turret well for emergency maintenance or troubleshooting. This safety feature embedded in the new system is new to SAIL plant.

Issues considered Some major issues that need to be addressed to achieve successful deployment of a wireless system in a hazardous industrial area follow[10]. www.steeltimesint.com

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Male connector

Security: Any complex process is controlled using vast numbers of real time measurements, the generation of set points for actuators according to process algorithm, transmission of set points to actuators and the response time of the actuators. However, from a security perspective authentication, integrity, availability and non-repudiation are important objectives. With digital security, no repudiation ensures that a transferred message has been sent and received by the parties claiming to have sent and received the message. No repudiation is a way of guaranteeing that the sender of a message cannot later deny having sent it and that the recipient cannot deny having received the message. These security mechanisms

Wireless unit in MCR

Analog output

Female connector DISPLAY

Availability: In large-scale industries such as an integrated steel plant, availability of equipment is of great significance.

Even short and transient communication errors can cause significant production outages. This is mainly due to the fact that production has to be stopped in a controlled manner in case of a single communication problem, and it can take up to several hours to achieve full production again. Production losses cost in the range of hundreds of thousands Rupees per hour. Self-healing mesh networks are used to counter failure.

Wireless unit on Turret

Load cell

Safety: The safety of man, machine, environment and property should always be the number one priority. Unsafe systems can cause substantial production losses or damage to equipment if not properly designed. Equipment must be able to go into safe mode on sensing a signal timeout. The control system should be able to sense the loss of communication. Even if wireless is used for process monitoring, utmost care should be taken to design the system so that it gives a real-time picture of the process.

PLC MP 100W

Slip ring MC 400W

Analog input

Fig 4 Method of weighing tar weight of steel in ladle

Original route

There are 8 load cells, 4 per arm

Junction box

Benefits The response time achieved by the wireless system was much faster and more reliable than the previous system. Dependence on the slip rings, control cables and junction boxes has been substantially reduced and this has helped reduce down-time leading to an increase in production.

DISPLAY

Female connector

Analog output Analog input

Fig 4 shows how the signals from the load cells are transmitted to the ground station using wireless modems. Similar systems are used for transmission of the limit switch and proportional valves.

PLC MP11

in the overall automation system must be implemented in an efficient way with respect to key management and the replacement of faulty field devices.

Latency: In any real-time control system delivery of data has to be on time. Data delivered too late is of limited or of no use. This is an important area of research, especially in industrial wireless where it can be mesh networks, frequency hopping situations, and synchronised communication in both directions between the nodes. New data should be propagated through the network instead of guaranteeing delivery of all transmissions.

To decrease the number of retransmissions in the industrial wireless network an error control technique such as forward error correcting (FEC) codes can be used. With respect to retransmissions in mesh networks and multi-hop situations, it has to be guaranteed that data is delivered in the correct sequence.

System integration: The most critical aspect for expansion of industrial wireless networks is integration into existing automation networks. In most of the projects at SAIL which are brownfield in nature, it is necessary to migrate from wired system to wireless, keeping the existing automation backbone intact.

System design has to be such that it is easily deployable, expandable in the future, has excellent troubleshooting feature, requires minimal maintenance and is maintainable by the available skill level of the plant.

Interference: Heavy industries often contain many sources of interference such as heavy electrical equipment and other communication systems that operate in the same frequency band.

Continued 37> March 2015

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Building SAIL’s new blast furnace The Rourkela Steel Plant’s (RSP) new blast furnace number five, commissioned by Steel Authority of India (SAIL) in 2013, was built by a consortium consisting of Danieli Corus and Tata Projects Ltd and entirely based on the technology and know-how of Danieli Corus. With much of the existing ironmaking capacity reaching the end of its technical and economic lifespan, the new furnace enables RSP to meet existing and future demand for its products. By J Bak* and E Engel*

THE Rourkela Steel Plant (RSP) was set up in 1959 by Hindustan Steel Limited, a company that would be integrated into SAIL upon its formation in 1973. The plant’s initial capacity was around 1Mt/yr, which, over the following decades, would grow towards 2Mt/yr with four blast furnaces and two BOF plants operating at the plant’s hot side.

India’s current accelerated economic growth boosts the country’s steel consumption: in the 2001–2012 period, India saw a growth of annual steel consumption from 28.5Mt to 73.6Mt for an average annual growth rate of 9%.

With the country’s per capita consumption at around 25% of the global average and at around 12.5% of that of China, there is substantial growth potential for the near future. SAIL decided on an expansion plan in 2006, with the objective of doubling the company’s total capacity. Table 1 presents key figures for this ambitious expansion plan with respect to the integrated steel plants operated by SAIL. RSP set out on an expansion programme towards 4.5Mt/yr for the site. In addition, RSP initialised modernisation to reduce the environmental emissions of the coke batteries and sinter plants. When the expansion programme was started, the upstream hot metal capacity was produced by four blast furnaces, three with an inner volume of 995m³ and one with an inner volume of 1448m³. All of these are of a 1960s design of German Production

After

Plant

2011-2012

expansion

Bhilai

5.1

7.5

+47%

Durgapur

2.1

2.5

+19%

Rourkela

2.3

4.5

+96%

Bokaro

4.0

5.8

+45%

Burnpur

0.5

2.9

+480%

14.0

23.2

+66%

Total

Table 1. Expansion Plan for SAIL Integrated Plants (hot metal production figures in Mtpa)

origin. For the expansion, RSP decided upon a fifth greenfield blast furnace of substantially larger inner volume and in full accordance with best technological principles.

Fig 1 The Blast Furnace

Fig 2 Bosh & Belly

Blast furnace No.5 The new blast furnace was designed with a 4060m³ inner volume for an average production of 8000 thm/d. The pulverised coal injection system is rated for 150 kg/ thm with a design provision for 200 kg/ thm. Hot blast is provided by three hot blast stoves with internal combustion chambers operating at a 1425 °C dome temperature. The furnace has four tapholes, operated in two casthouses (Table 2).

The furnace lining design is based on the “Hoogovens” high conductivity integrated cooling and lining concept with copper cooling plates and graphite refractory. This modern lining design minimises sliding effects in the bosh and the equilibrium lining profile enables the creation of a stable accretion, which protects against erosion. The belly and lower stack include a combination of graphite and silicon carbide refractory and machined copper plate coolers, which enable the creation of an accretion, but also provide sufficient erosion resistance if the accretion is not present. A campaign life of 25 years is achieveable at high PCI and productivity levels and/or when operating on lower or varying quality raw materials. Fig 1 Metric

US

Inner Volume

4060 m³

143378 cuft

Working Volume

3470 m³

122542 cuft

Hearth Diameter

13.2 m

43.3 ft

Production (avg.)

8000 thm/d

8840 thm/d

Production (peak)

8320 thm/d

9193 thm/d

PCI rate (target)

150 kg/thm

300 lbs/thm

PCI rate (design provision)

200 kg/thm

400 lbs/thm

1425 °C

2600 °F

Hot Blast Stove dome temp.

Table 2. RSP Blast Furnace No. 5

*Danieli Corus, Rooswijkweg 291, 1951 ME Velsen–Noord, The Netherlands, tel: +31–251–500 500, email: comms.office@danieli–corus.com March 2015

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Fig 3 Tangential Cyclone: paths of 5 micron, 15 micron and 30 micron particles

35

Fig 4 3D overview of blast furnace plant

Fig 6 Construction activities

Fig 5 Lifting of bosh segment of shell

illustrates the general arrangement of the furnace, Fig 2. the design of the bosh and belly.

The gas cleaning system is based on the Danieli Corus cyclone dustcatcher with a single tangential inlet and an annular gap scrubber.

The main advantage of this type of dustcatcher – as opposed to traditional, gravity-based systems – is that the characteristics are such that 85% of the zinc-poor fraction of dust is separated here, leaving the smallest possible zinccontaminated fraction for the scrubber.

With gravity dustcatchers, 50% of the dust is separated, with two thirds of the remainder still made up of zinc-poor dust; this introduces a far larger amount of dust that cannot be recycled to the sinter plant and/or strongly increased additional cost for processing (Fig 3).

Finally, the plant is equipped with a slag granulation system based on a dewatering wheel, a Top Gas Recovery Turbine (TGRT) and raw materials are belt-charged to the bell-less top (Fig 4).

The project On October 2nd 2008 (M.K. Gandhi’s birthday), RSP signed a contract with a consortium consisting of Danieli Corus and TPL for the lump-sum turnkey supply of Blast Furnace No. 5. Danieli Corus was www.steeltimesint.com

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responsible for the engineering and supply of technological items as well as erection supervision, operational assistance and training. TPL was responsible for the engineering and supply of the balance of the scope (e.g. civil) as well as erection.

In projects of this magnitude, project management is pivotal in terms of coordinating all the processes pertaining to areas such as engineering, procurement, inspection, logistics and erection. This particular project was executed under conditions that called for specific measures.

Client’s engineer Mecon, an organisation operated by the Government of India and based in Ranchi, acted as the client’s engineer on behalf of SAIL. Mecon has specific know-how on the various packages, leading to many interesting discussions on technology.

In those discussions, the various parties challenged each other’s views in order to get the best result for the project. This established a solid technical base between the parties and prevented lack of clarity during construction.

Co-operation within consortium Since the majority of the scope was with TPL, this party acted as consortium leader, taking care of all communication with

the client. Extensive document control systems were set up within all parties (TPL, Danieli Corus, Mecon and RSP) as well as between them. Numbering systems were established for engineering documents but also for email messages and letters.

Furthermore, much attention was paid to document tracking and issues to be solved. This proved to be effective as not a single document was missed or a single issue left unfinished.

Finally, contractual planning was detailed into a Level 4 Planning, in which the schedules of Consortium members and their subcontractors were merged.

Monthly meetings were organised by RSP’s project department, which kept tight control.

Logistics A total of 950 containers and various breakbulk transports with foreign supplies were landed at Kolkata and trucked to Rourkela.

The distance between the Kolkata Dock System (KDS) to RSP is around 350 miles and given the time-consuming nature of road travel in India, transport had to be scheduled meticulously, also with respect to the site’s maximum ability to accept containers as well as oversized shipments simultaneously.

Foreign materials came from all continents. Canadian and Northern March 2015

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Fig 7 Plot plan

Fig 9 Hot metal silicon content (%), first 40 casts

European winters brought challenges, given the risk of waterways and vessels freezing. At one point, a ship had to be chartered from the warmer Mediterranean area to pick up cargo in Antwerp, Belgium, since all ships in that area had frozen cranes and decks.

Despite the above problems and the extensive exercise required for importing goods into India, logistics ran relatively smoothly.

On site, two indoor storage facilities were made available specifically to Danieli Corus for the storage of dry materials, the larger of which was designated for the storage of refractories. In addition, RSP stored an amount of materials in other facilities within the plant, some of which were in the open-air.

For the pre-assembly of larger components, such as segments or rings of the blast furnace and hot blast stove shells, lay-down areas were allocated within the final plot plan of the blast furnace plant.

With designated areas for each of the several pre-assembly activities, scheduling and execution of these activities could be optimised (Fig 5 & Fig 6).

Climate/monsoon Temperatures well over 100 degrees Fahrenheit between May and July and monsoon rains from July to September March 2015

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Fig 8 Blast furnace amidst existing plants

Fig 10 Flat casthouse floor

added a level of complexity to the projectâ&#x20AC;&#x2122;s execution. Day work was shifted towards the early morning and late afternoon.

Lighting was set up to enable work in the darker, yet cooler hours. Work on refractories inside the furnace shell and stoves was mostly carried out in cooler seasons.

In the hot seasons, wind may at times make working outside impossible given the risk of facial burns in case of prolonged exposure. Foundations and cable tunnels needed to be finished before July, and ditches for water evacuation were excavated annually before the start of the monsoon.

Finally, blowing in a furnace during monsoon requires special safety measures to avoid steam explosions in, for example, the slag pits and dry pits. These measures will be discussed later in conjunction with the furnaceâ&#x20AC;&#x2122;s blow-in and ramp-up.

The importance of fitting in As indicated in the plot plan (Fig 7) the new furnace and its ancillary equipment (in colour) had to fit existing plants (in black). Space available was sufficient for the entire blast furnace plant, albeit with adjustments to accommodate existing logistics for the supply of coke and ferrous raw materials and tieâ&#x20AC;&#x201C;ins with routing for hot metal transfer towards the steel plant

and downstream slag processing.

Whereas during the early phases, the plot plan was sufficiently spacious to carry out several erection activities (with or without the requirement for a lay-down area) simultaneously, the final revised plot plan for the plant is clearly a precise and tight fit. However, none of the logistical movements are hampered and the layout has proven to be well thought out (Fig 8).

Commissioning and ramp-up On 6 August 2013, the new Blast Furnace No. 5 was blown in by a joint commissioning team consisting of RSP operators and Danieli Corus specialists.

The furnace was filled with wood up to tuyere level and on top of that, a 1260 metric ton coke blank was charged (1389 short tons). The remainder of the working volume received a burden with an 800kg/ thm (1600 lbs/thm) coke rate.

Around 29 hours after the furnace was lit, the first cast was made through Taphole No. 1. During the first hours, the coke rate was decreased relatively aggressively. As a consequence, hot metal slag separation started faster than planned.

Also, the lower coke rates ensured that all hot metal tapped after the start of separation had a sufficiently low silicon content to be used in the steel plant (Fig 9). www.steeltimesint.com

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as the flush and flat design offers all of the intended ergonomic advantages now that the area is cleared and operations have normalised.

Fig 11 Inauguration by SAIL Chairman CS Verma.

Given the monsoon, there were large amounts of water in the blast furnace area, especially in the slag pits and this meant that major safety precautions had to be taken. SAIL management took it upon themselves to ensure that the new Blast Furnace No. 5 was accident-free.

A forgiving furnace During ramp-up, the furnace appeared to be very forgiving, accepting, for example, many low-blast periods with causes within and beyond the blast furnace complex.

Danieli Corus provided extensive training to RSP personnel covering operational, maintenance and automation staff.

The end result was heartening as hardly any assistance was required during the months immediately after the blow-in; afterwards RSP operators took over the furnace and took it forward.

Transition to normal operation After the blow-in and ramp-up periods, transition to normal operation was quick.

With these labour-intensive periods and the need to have direct access to the trough and runner systems belonging to the past, several working areas and platforms could be cleared and housekeeping straightened out.

Both casthouses set excellent examples

Conclusions • The RSP No. 5 project proves that plant capacity can be doubled smoothly within a few years if the workforce is dedicated to the project and plant management is willing to demonstrate leadership. Doubling capacity can be achieved sustainably by investing in the best available technology and training for both operational and maintenance personnel.

• Current technology allows for greenfield plants to be fitted into tight plot plans and tied in to existing plant logistics without problems. However, technology development may be beneficial for this process when equipment such as hot blast and gas cleaning systems becomes more compact rather than allow for increasingly complicated connection and tie–ins.

• The prospects for the Indian economy are promising in the mediumto-long-term and, therefore, similar projects can be expected in future where the lessons learned will prove valuable in terms of design and construction. In many other developing economies in the region, greenfield projects are expected longer term, mostly without the brownfield aspects of those in India. t

<Continued from p33 - Wireless signal transmission for the ladle turret on continuous casters

Thus, it is very important that the wireless system can co-exist in a radio environment containing a large amount of interferences as well as limit any disturbance it may create itself.

The obvious countermeasure for interference is the use of different diversity (time, frequency, and space) schemes, or more advanced innovative techniques such as interference cancellation, effective radio resource management and so on.

Conclusion The successful use of wireless technology has immense potential in steel plants with their harsh operating environments containing dust, smoke, vibration, EMI/ noise, and extremely high temperatures.

The system developed has potential for technological transfer to areas such as raw materials handling, coke ovens, sinter plants and blast furnaces for status monitoring, precise control of network operations and the enhancement of productivity. t Acknowledgments The authors are grateful to the collective of www.steeltimesint.com

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Operation, Electrical & Mechanical department of SMS-II, and Research & Control Lab of RSP. The authors are also grateful to the management of RSP and RDCIS for their continuous support, guidance, encouragement and all the necessary facilities provided for smooth execution of this project.

References [1] Gerrit Lohmann, ‘WirelessHART™’, Technical White Paper, Wireless Technology , Part No 217955 02/11 01, http://files.pepperlfuchs.com/selector_files/ navi/productInfo/doct/tdoct1841a_eng.pdf [2] B&B Electronics Mfg Co, ‘Ten commandments of wireless communications’ WP-33-R2-1112-1/6 © 2009 by Inc. http://www.bb-elec.com/getattachment/0f96d637 -c944-4c31-9ba1-bd247c1abb25/10-Command -of-Wireless-Communications.aspx [3] Taylor Reynolds, ‘Advanced wireless technologies and spectrum management, Workshop on radio spectrum management for a converging world’, ITU new initiative programme, 16-18 Feb, 2004 Geneva.

[4] Application manual of MC400W controller, ABB, 3BSE014042R0101,2000-05.

[5] Data Communication Fundamentals,

Version 2 CSE IIT, Kharagpur. http://nptel.iitm. ac.in/courses/Webcourse-contents/IIT%20 Kharagpur/Computer%20networks/pdf/M2L1. pdf [6] Angeliki Alexiou1, Monica Navarro and Robert W Heath Jr,’Smart antennas for next generation wireless systems’, EURASIP Journal on Wireless Communication and Networking 2007, 2007:020427 doi:10.1155/2007/20427 [7] Andreas Willig, Kireten Matheus, and Adam Wolisz, ‘Wireless technology in industrial networks’ proceedings of the IEEE, VOL. 93, no. 6, June 2005.

[8] J R. Moyne and D M. Tilbury, ‘The emergence of industrial control networks for manufacturing control, diagnostics, and safety data,’Proceedings of the IEEE, vol. 95, No 1, pp. 29–47, Jan. 2007.

[9] Cirronet, Inc, ‘Wireless Communications for Industrial Applications’ White Paper, summer 2002, http://www.lanstore.com/ techsupport/papers/2411wp.pdf [10] Johan A kerberg, Mikael Gidlund, Mats Bjorkman ‘Future Research Challenges in Wireless Sensor and Actuator Networks Targeting Industrial Automation ‘ 9th IEEE International conference on Industrial Informatics.

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Improving energy efficiency in a rotary kiln for lime production The development of a dual-fuel burner and automatic combustion control for the rotary lime calcining kilns at Bokaro Steel Plant has enabled lower-cost coke-oven gas to be used in addition to liquid fuels.

Lime quality has improved, productivity increased by around 4% and specific fuel consumption fallen 5.2% giving a pay-back time for the investment of just five months. By I N P Gupta*, M Sen*, S K Das**, P K Mishra**, R K Behra**, TS Reddy* & S C Mukhopadhyay** Recent developments in burner design(2, for rotary kilns emphasise the use of burners that can use multiple fuels and the need to control flame length and shape by using a split supply of combustion air in which pre-heated low primary air flow maximises fuel burn efficiency. Burners are designed with a sturdy and rugged construction for high temperature duty.

Such improved burners require steam and high and low pressure air for atomisation of liquid fuels. The oil guns can atomise a wide range of fuels from diesel oil to heavy fuel oils, with excellent turndown(4, 5). In the high momentum burner, the arrangement of the primary air outflow as individual air jets has a very 3)

favourable effect on combustion as it assures rapid mixing of the hot secondary air into the flame. The form of the flame is adjusted by means of the high momentum primary air(6).

To overcome the deteriorating performance of the existing burners in the rotary kilns at Bokaro, it was decided

by BSL and the Research & Development Centre for Iron & Steel (RDCIS) to design and develop an efficient dual fuel burner along with the necessary automatic control of combustion, and introduce this into two of the kilns as a trial with the aim of reducing specific fuel consumption by 5% through improved combustion efficiency.

Fig1 Rotary kiln for producing calcined lime Calcining zone Cooling zone Kiln hood Tyre Flame Burner

Preheating zone Drive gear

Limestone

Exhaust gas out Hot air from cooler

Lime to cooler

Steel shell 850-950°C (hot end)

Firebrick lining

450-500°C (cold end)

1010-1340°C

CO gas

Fig 2 Dual fuel burner for rotary kiln Refractory castable insulation

Swirler

Pr. air-I

PCM emulsion

Pr. air-II

THE Refractory Material Plant (RMP) at Bokaro Steel Plant Ltd (BSL) of the Steel Authority of India Ltd (SAIL) is equipped with six rotary kilns for calcining limestone for use in the Basic Oxygen Furnaces (BOFs). All six rotary kilns are identical in design and the production capacity of each is 13t/hr of calcined lime. The kilns were designed to be fired with a pitch creosote mixture (PCM) through atomised liquid fuel burners operating at 25kgf/cm2 pressure. To shift the calcining zone in the kiln required physical relocation of the burner assembly.

In pressure-atomised burners, the liquid fuel at high pressure is expanded at high velocity through a nozzle of 3 to 5mm diameter to near atmospheric pressure. Due to this sudden release in pressure, the liquid becomes atomised to fine particles which are then mixed with combustion air. Hence, the atomisation and performance of these types of burners is very much dependent on the pressure of the liquid fuel. Calcination of limestone is an endothermic reaction. This reaction is completed when the temperature is above the dissociation temperature of the calcium carbonate in the limestone.

This temperature lies between 101013400C(1). During such complete thermal decomposition of pure calcium carbonate, there is a theoretical loss of weight of 44% as carbon monoxide is evolved. This is termed ‘loss on ignition’ (LOI).

At the Bokaro plant, the injection pressure fell from 25 to 10-15 kgf/cm2 over the years due to a reduction in the efficiency of the pump resulting in poor atomisation of the fuel leading to a higher specific fuel consumption and wider variation in LOI.

*Research & Development Centre for Iron & Steel, Steel Authority of India Limited, PO - Doranda, Ranchi - 834 002, Jharkhand, India **Bokaro Steel Plant, Steel Authority of India Limited, PO - Bokaro Steel City – 827001, Jharkhand, India. Contact e--mail inpgupta@sail-rdcis.com March 2015

FURNACES SAIL.indd 1

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FURNACES

Design features and parameters

Former PCM burner

Improved dual fuel burner

Fuel firing capability

PCM

PCM & CO gas simultaneously or separately

Fuel firing capacity (maximum)

3000 kg/hr

PCM

motion into the primary combustion air to make the flame shorter and brighter or by increasing the axial velocity in the primary air to make the flame longer. This requires two primary air blowers, one with a swirler at the nozzle tip and the other a simple straight tube. By controlling the ratio of these two primary air streams, the degree of swirl of the primary air is adjusted to change the flame length to shift the calcining zone along the rotary kiln. In addition, control of the air/fuel ratio is required for better fuel efficiency.

CO gas

3000 kg/hr

7000 Nm3/hr

Calorific value of fuel

8500 kcal/kg

8500 kcal/kg

4100 kcal/Nm3

Pressure requirement of fuel

25 kgf/cm2

5 kgf/cm2 (g)

400 mmWC (g)

Temperature of fuel

PCM: 90-1100C

90-1100C

Atmospheric temperature

Method of atomisation of PCM

Mechanical atomisation

Emulsion type atomisation

Atomising fluid

Not required

Super heated steam and compressed air

No. of combustion air blowers required

One

Two

Combustion air flow

10000 Nm3/hr

10000 Nm3/hr through both air blowers

Primary air-I supply pressure

400 mmWC (g)

800 mmWC (g)

Primary air-II supply pressure

-

400 mmWC (g)

Shifting of calcining zone

By moving burner assembly

By changing the proportion of two primary air streams

Automatic control of air/fuel ratio

Not available

Provided

Improved design of burner A dual fuel burner capable of firing both pitch creosote mixture (PCM) and coke oven gas (CO) simultaneously or separately was designed and developed for rotary kilns 3 and 4. The design features and parameters of the previous PCM burner and new improved dual fuel burner are given in Table 1.

The dual fuel burner is shown in Fig 2. The improved burner consists of four concentric pipes, the central pipe accommodates the PCM emulsion gun.

The next pipe from the centre supplies primary air type I through a new high pressure blower. This pipe has a swirler at the nozzle tip. The third pipe from the centre is for CO gas. The fourth, outermost pipe, is to supply primary air-II through the existing low pressure air blower. The hot end of the burner is insulated with 50mm of thick self-flow castable refractory attached with stainless steel anchors and extending 2m along the burner to prolong the life of the burner tip. The self-flow castable was pre-heated slowly after two days of drying to remove the remaining moisture.

The pressure required to inject PCM in the new burner is only 20% of that required in the old burner as no mechanical atomisation is required. However, the atomisation of the liquid fuel, especially of viscous fluid such as PCM, is very much dependent on fluid temperature. The temperature of the PCM should be above

Table 1 Features and parameters of the former PCM burner compared to the new improved dual fuel burner Equipment/instruments

Fluids

Purpose

Micro-processor-based controller

CO gas, PCM, steam, Primary air-I & II

Flow control

Orifice plates, pressure and differential pressure transmitter

CO gas, steam and Primary air-I & II

Flow measurement

Mass flow meter

PCM

Flow measurement

Control valve

CO gas, PCM and steam,

Flow regulation

Combustion air blower with inlet damper

Primary air窶的 & II

Regulated combustion air supply

Thermocouples with temperature transmitter PCM and steam

Temperature measurement

12-points chartless recorder and display unit CO gas, PCM, steam, Primary air-I & II

Recording and display of parameters

Audio and visual alarms

Initiation of alarms in case of low pressure of

CO gas, PCM and Primary air-I & II

CO gas (<200 mmWC), PCM (<2 kgf/cm2) and tripping of blowers for Primary air窶的 & II

Table 2 Major installations for modified combustion system in rotary kilns 3 & 4 CO2

CO

O2

H2

CH4

C2H4

N2

3.0

9.0

0.2

54.9

25.0

3.0

4.9

Table 3 Typical composition of CO gas available at BSL (% by volume)

Rotary kiln The rotary kiln is a cylindrical vessel rotating slowly about its axis and inclined a few degrees to the horizontal down towards the discharge end. A burner at the discharge end raises the temperature of the charge to achieve calcination in a continuous process (Fig 1). Modern combustion systems consist of a burner capable of firing multi-fuels simultaneously or separately depending on availability.

The burner must ensure complete burning of the fuel and generate a flame of

C

H2

S

H2O

84

15

0.5

0.5

Table 4 Typical composition of PCM available at BSL (% by weight)

sufficient length to adjust the temperature zones inside the kiln depending on the charged materials. A change in flame shape is achieved by adjusting the gas and air-flow rates. In the case of a liquid fuel burner, a change in flame shape is a little more difficult than if the fuel is gas and is normally achieved by imparting a swirling

Emulsion gun Mass flow meter

Hot end temperature

PCM nozzle

PCM flow

PCM

Compressed air Steam

Fig 3 PCM emulsion gun

March 2015

FURNACES SAIL.indd 2

Tx

1- Temperature controller 2- Fuel flow controller 3- Fuel/air radio controller 4- Air flow controller - I 5- Air flow controller - II 6- Steam/PCM radio controller

P 6

P Damper

Primary air-I blower Primary air-II blower

5

To burner

Px

Px Electrical actuator

3

Emulsifer

Tx

2 Co gas flow

Emulsion

View - B

PCM

View - A

Orifice plate Temperature transmitter

Steam PCM Co gas

1 B

A

Control valve

Px

Px

4

P

P

Electrical actuator Orifice place P Pressure transmitter Px Flow transmitter Tx Temperature transmitter Control valve/damper Mass flow meter

Fig 4 System of automatic control of air/fuel ratio

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FURNACES

900C for best atomisation. The PCM emulsion is prepared using super-heated steam in an emulsifier. The emulsion stream is connected to the PCM emulsion gun through mild steel pipes which have large radius bends to minimise flow restriction.

Compressed air is supplied separately to the PCM emulsion gun through another mild steel pipe again with large radius bends. The PCM emulsion gun is provided with a detachable nozzle in which these two streams mix in a ‘Y’-jet form and exit the nozzle as shown in Fig 3. These two streams determine the shape of the atomised PCM spray and the flame-shape.

Automatic mixture control Automatic control of combustion enables the use of CO gas alone or PCM alone to achieve a set temperature value at the hot end of the rotary kiln. Since the use of both the gaseous and liquid fuels fired simultaneously arises only about 5% of the time, the automatic control system has not been designed for firing both fuels together and manual setting is required in this circumstance. Accordingly, a manual fuel-selector switch for the various combinations of PCM alone, CO gas alone and both fuels simultaneously is provided. The main items installed to modify the combustion system are given in Table 2. The mass flow meter which works on the Coriolis principle and the control valve provided in the PCM line are steam jacketed to prevent them choking.

The control of CO gas or PCM flow is determined by the temperature set value of the hot end of the kiln using the temperature controller. Under automatic mode, the fuel flow and both primary air–I and II are maintained to achieve the set value. In the case of a cascade mode of operation of the kiln, the set value is the input parameter to the temperature controller. Based on this set value the fuel flow is regulated along with the primary air–I and II by respective controllers. In the case of PCM firing only, the ratio of steam/PCM flow is set in the steam/ PCM ratio controller. The fuel/air ratio controller calculates the total requirement of combustion air to meet the set air/fuel ratio.

The composition of the fuel is needed to calculate the total combustion air required. Typical compositions of CO gas and PCM available at BSL are provided in Table 3 and 4 respectively.

The air flow required (VAIR (CO)) for CO, allowing 10% excess air for complete combustion of CO fuel gas is calculated in terms of the percentage of constituents as: VAIR (CO) = 4.76 x [0.5(CO + H2) + 2CH4 + 3C2H4 - O2] x 1.1/100 The air flow required (VAIR (PCM)) for www.steeltimesint.com

FURNACES SAIL.indd 3

Parameters

Before

After

Average production (t/shift)

86

90

Specific fuel consumption

2.102

1.993

Variation in LOI (%)

2–8

2–5

Hot end temperature (0C), max.

900

950

Cold end temperature (0C), max.

500

450

41

(Gcal/t of gross lime)

Table 5 Operational and production data of rotary kiln # 3 and 4 before and after modification

PCM, allowing 15% excess air for complete combustion of PCM is calculated in terms of the percentage of constituents as: VAIR (PCM) = 4.76 x [1.867C + 5.6H+0.7(S – O)] x 1.15/100 Complete combustion of the fuel air is supplied in three streams. About 60– 65% (part-A) is pre-heated by passing through the lime cooler and is supplied as secondary air in the rotary kiln through the lime discharge opening at the bottom of the hot end of the kiln. The balance of 35-40% (part-B) of the combustion air is supplied as primary air by two separate combustion air blowers. The set value of the ratio of primary air–I to primary air– II is set in the fuel/air ratio controller to achieve the required flame length. Air flow controller-I allows a certain proportion of part-B air to be supplied as primary air–I depending on the set ratio of primary air–I to primary air–II. Air flow controller-II allows the remaining percentage of part–B as primary air-II. The control scheme for automatic operation of the air/fuel ratio in rotary kiln 3 and 4 is shown in Fig 4.

Benefits The improved dual fuel burner worked satisfactorily in all three situations namely a) with PCM firing alone, b) with CO gas firing alone and c) with simultaneous firing of both fuels.

The former PCM-only burner could not make use of the availability of cheaper CO gas from the coke ovens. With the new dual-fuel burners, the kilns can be fired with CO gas when available.

Also, the performance of the PCM emulsion burner has improved due to better atomisation of PCM using superheated steam and compression in two stages. Since the improved dual fuel burner requires only a low PCM pressure of 5.0kgf/cm2, maintenance of the PCM pump has reduced substantially. Further, the fuel efficiency has increased due to the provision of automatic control of the air/ fuel ratio.

Regarding the calcining zone, the former PCM burner had to be physically shifted to adjust this inside the rotary kiln, but with the improved dual fuel burner, adjusting the calcining zone is achieved by changing the ratio of primary air-I and primary air-

II. The operational and production data before and after modification for rotary kiln # 3 and 4 are given in Table 5.

Rotary kilns 3 & 4 are now consistently producing 90t/shift of calcined lime – a 4.6% increase – while using 5.2% less fuel per tonne. Further, the variation in LOI has fallen to a narrower range of 2-5% from the previous 2-8 %. Average productivity has increased by about 4%.

The hot end temperature has increased to 9500C against 9000C due to the provision of the swirler in the primary air-I stream.

This has also resulted in a lowering of the cold end temperature to 4500C. Both kilns are operated in automatic/cascade mode successfully since their commissioning with the improved dual fuel burner and combustion control system.

The pay-back period is only about five months.

As a result of these encouraging results, BSL has already initiated action to introduce the improved dual fuel burner along with automatic control of the combustion system in the four remaining rotary kilns. t Acknowledgment The authors are grateful to the management of RDCIS and BSL for providing the opportunity and support to complete the assignment.

They also wish to thank them for providing permission to publish this paper.

References 1) Robert S Boynton, Chemistry and technology of lime and limestone, John Wiley & Sons, New York, 1966, pp-143.

2) h t t p : / / w w w. m e t s o . c o m / i n / m i n i n g andconstruction/MCT_India.nsf/WebWID/WTB110414-22577-1168C/$File/Burner_System_ for_Rotary_Kilns.pdf 3) http://www.flsmidth.com/~/media/ Brochures/Brochures%20for%20kilns%20 and%20firing/DUOFLEX.ashx 4) http://www.coen.com/wp-content/ uploads/Rotary_Kiln_Burner.pdf 5) A N Sayre, J Dugue, R Weber, J Domnick and A Lindenthal, Characterisation of semiindustrial-scale fuel-oil sprays issued from Y-jet atomiser, Journal of the Institute of Energy, June 1994, vol-67, pp70-77.

6) http://www.greco-ltd.com/general/ hot-news/detailseite-news/article/the-wayhigh-momentum-kiln-burners-improve-thecombustion-process.html March 2015

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PERSPECTIVES: ENDRESS + HAUSER

Global contracts with big players Based in Germany and specialising in measurement instrumentation, services and solutions, Endress + Hauser is active in all sectors of an integrated steel plant or minimill, says Jens Hundrieser, the company’s global industry manager for primaries and metal

1. How are things going at ENDRESS + HAUSER? Is the steel industry keeping you busy?

The steel industry is one of Endress+Hauser`s key markets into which we supply adapted packages of measurement instrumentation, services and solutions.

We are working with all steel producers and plant builders worldwide and we have global contracts with the world’s largest steel producers.

9. It is always claimed that aluminium is the ‘greener’ metal when compared to steel. What’s your view?

When comparing the two metals – steel and aluminium – it is important from a sustainability standpoint to look at the whole life cycle from production through to recycling. The recycling rate plays a major role. Steel is magnetic and easier to separate and, therefore, is recycled more than all other materials.

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

Steel consumption is cyclical with regional overcapacity in China and Europe.

Additionally a consolidation process of the major steel producers is underway but not finished yet. However, increasing urbanisation and a growing global population has led to increased demand for long and flat products for automotive, heavy machinery, pipes and highperformance steel products. Steel demand can be expected to remain strong.

3. In which sector of the steel industry does ENDRESS + HAUSER mostly conduct its business?

Endress+Hauser is active in all sectors of an integrated steel plant or minimill and besides the production process is also active in utilities, industrial wastewater and power plant. It strives to support and solve the main challenges of keeping the plant safe, boosting environmental compliance and reducing costs.

4. Where in the world are you busiest at present?

Globally in brownfield and greenfield projects with the steel majors and plant builders as well as the engineering companies, meaning that we are very much project dependent. China still dominates in terms of MRO business and integrated steelworks, but there are an increasing number of minimill projects in the Middle East, Eastern Europe and the Americas.

5. Can you discuss any major steel contracts you are currently working on?

March 2015

PERSPECTIVES .indd 1

Jay Baron, president of the Centre for Automotive Research. Who is closer to the truth – Dick or Jay? Probably Jay with his 15-year perspective.

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

My personal view is that, besides the issue of light weighting, the safety aspects are also of key importance. So today – and probably in the future too – aluminium and steel will both play an important role. to play.

7. “While there will be increased aluminium penetration, vehicles will continue to be predominantly steel,” said Ducker Worldwide’s Dick Schultz. Is he right or wrong?

As mentioned before, taking into account weight reduction and usage in respect of safety, production costs and recycling (meaning sustainability) I would agree with this statement.

8. “Within the next 15 years or so there could be a nearly even split between steel, aluminium and carbon fibre content in the average North American produced light vehicle.” So said

10. “…any hint of doubt when it comes to predictions of climate doom is evidence of greed, stupidity, moral turpitude or psychological derangement.” This is a quote from Bret Stephens writing in The Wall Street Journal.

Do you sympathise with his view?

It is important to look at the different causes influencing long-term shifts in weather conditions such as changes in temperature, wind and other indicators.

Carbon dioxide is one main cause of human-induced climate change and we should be focusing on creating awareness of the issues involved and reducing our carbon footprint.

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

The iron making process is the most emissions-intensive part of the steel production process and it is down to individual governments to boost environmental compliance and responsibility where controls to reduce GHG emissions are concerned.

Besides the key topics of energy management, (waste) heat recycling and process optimisation, the CCS approach of the ULCOS project is addressing the aforementioned topics. www.steeltimesint.com

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PERSPECTIVES: ENDRESS + HAUSER

12. Are you finding that steel producers are looking to companies like ENDRESS + HAUSER to offer them solutions in terms of energy efficiency and sustainability? If so, what can you offer them?

Our process experts offer step-by-step guidance to steelmakers as to the bestfit products, services and solutions that actively reduce costs and maximise energy efficiency – focusing on utilities (‘WAGES’ – or ‘Water Air Gas Electricity Steam’) and combustion applications.

We have recently added consultancy to our portfolio of customer support services with a view to helping them achieve sustainable energy savings starting with energy efficiency and linked to the implementation of an Energy Management System ISO50001.

13. How quickly has the steel industry responded to ‘green politics’ in terms of making the production process more environmentally friendly and are they succeeding or fighting a losing battle?

The biggest challenge for the steel industry is that ‘green politics’ worldwide differ from one country to another and is not aligned with different emissions legislation. Producers in regions with higher legal requirements on the reduction of greenhouse gas or particle emissions feel they are being treated unfairly if they need to compete against international competitors who don’t adhere to such demands. Global harmonisation is needed to avoid plant shut downs and the phenomenon of plants closing down and then re-opening in countries with lower environmental standards – otherwise known as ‘carbon leakage’. It looks as if the situation is improving slowly.

14. Where does ENDRESS + HAUSER lead the field in terms of steel production?

Endress+Hauser is a global leader in measurement instrumentation for the metal/steel industry and offers the broadest of product portfolios in addition to dedicated sales centres and a strong network of partners and production centres in 11 countries.

15. How do you view ENDRESS + HAUSER’s development over the short-to-medium term in relation to the global steel industry?

The heart of our business is the instruments and in addition we strive to understand our customers’ business in relation to process automation. We optimise our customers’ processes in terms of reliability, safety, economic efficiency and environmental impact. www.steeltimesint.com

PERSPECTIVES .indd 2

16. China dominates global crude steel production and is accountable for almost half of total production. How should the industry react to this situation?

The Chinese market offers opportunities for iron ore suppliers and still imports highend steel products. The key to success is being a step ahead regarding innovations and being competitive with new advanced high-strength steels.

17. What is ENDRESS + HAUSER’s experience of the Chinese steel industry?

Endress+Hauser has been active in China for several years and has a dedicated sales and service centre in the country and offices in various cities. We offer local production in Suzhou. Our focus on steel is a key success factor along with our ability to speak our customers’ language.

18. Where do you see most innovation in terms of production technologies – primary, secondary or more downstream?

The main development trends in all production areas are designed to improve energy and resource efficiency as well as improve flexibility, quality and works logistics. The most innovations are to be seen in the oven and furnace processes.

19. How optimistic are you for the global steel industry going forward and what challenges face global producers?

A growing world (urban) population needs automobiles, consumer durables, machines and infrastructure and steel is one of the basic and necessary raw materials. Innovative special steels are available for the automotive industry and for energy technologies, such as wind and gas, as well as for resource efficiency and recycling. The volume of steel consumed

43

was and is a barometer for measuring development and economic progress.

20. What exhibitions and conferences will ENDRESS + HAUSER be attending in 2015?

We are participating in all industries at major exhibitions and conferences, including the METEC exhibition in Düsseldorf, an international industry gathering for the metallurgical technology industry held every four years.

21. ENDRESS + HAUSER is based in Switzerland, but what’s happening steel-wise in Europe?

The European steel industry is under pressure from overcapacity, a growing number of international competitors, stringent European emission control requirements and punitive energy costs plus volatile raw material prices. Production

volumes are declining and investments are focusing on plant modernisation and advanced high strength steels.

22. Apart from strong coffee, what keeps you awake at night?

I like strong coffee and espresso, also cappuccino, and fortunately I sleep quite well. When I am awake it has a lot to do with jet lag, but sometimes I wake up in the middle of the night with some good ideas and have to get up and make notes.

23. If you possessed a superpower, how would you use it to improve the global steel industry?

I would ensure that every minimill and every integrated steel plant takes a closer look at ways of keeping their production plants safe and environmentallyfriendly and pay particular attention to reducing production costs and maintaining energy efficiency through process optimisation. t March 2015

3/12/15 9:18 AM

44

HISTORY

A difficult decade for steel Foreign competition and imports of raw materials plus worsening conditions in the British coal industry made the 1890s a troublesome decade for the steel industry in the UK. By Harry Hodson* THE 1890s was a troubled decade for the fledgling British steel industry. The main causes were foreign competition and imports of raw materials, and worsening conditions in the British coal industry.

Since its conception in 1860 the modern steel industry had seen a rapid expansion fuelled by the shipbuilding and railway industries, and was now setting its sights on new markets created by the automobile and electrical industries. There had been casualties along the way and these were usually smaller companies whose main problems were a lack of capital rather than a lack of orders. This resulted in some companies taking over the smaller concerns which led to the formation of some of the names which dominated much of the 20th century, Dorman Long, John Summers, Richard Thomas & Baldwins.

Strikes In 1893 there had been a number of prolonged strikes by the coal miners; these were mainly in the Lancashire area and led to the shutdown of several blast furnaces which badly affected bolt and nut manufacturing, which was a major employer of the time. In the same year, strikes by the Durham and Yorkshire miners, and moulders and patternmakers in the Tyneside shipyards, spread both North and South to Scotland and Derbyshire. Anyone not affected by the strikes usually had other problems in the form of the high cost of materials due to lack of supply. Employees of Dorman Long

were more fortunate than others; they had the financial means to keep their workers employed elsewhere, such as in their ore mines, or on general maintenance inside the works. Such were the conditions in some parts of the country that some companies reported that they were making no profit at all from making steel.

They were keeping going by the sale of byproducts, tar, paint, liquid and solid fuels, and slag. Slag, which was once regarded as waste, was now a major ingredient in the fertiliser industry. In 1893 58kt of slag was exported to Germany for use as “manure” for the growing of beetroot.

Even the expanding railway industry was of little help to some steelmakers. Rails were now being sold at £3.12/6 per ton, the price being driven down by some foreign imports. Some companies refused to make them and switched their attentions to other markets. Local pig iron was selling at £1.16 per ton whereas it could be imported from Alabama for £1.4-0 per ton. Some companies found business with the expanding Indian Railways for the building of bridges and locomotives.

The Cleveland Bridge Building Company, based on Tyneside, exported some of the largest structures that are still in use on the sub-continent. Beyer Peacock of Manchester and the Vulcan Foundry at Newton-le-Willows also had full order books for the supply of locomotives to the Indian Railways.

The great chronicle of industry, The Engineer, visited the Atlas Iron and Steelworks in 1894 to report on trade

and conditions. The works had been established in the 1840s, its main business was to supply the railways.

Bessemer steel Rolling mills were laid down in 1862 and the furnaces were rebuilt in 1873 to increase capacity. Atlas Iron and Steelworks was the first to be granted a licence to make Bessemer Steel.

The company had its own coalmines producing enough coal to sell on after meeting its own needs. Fuel consumption was 700 tons of coal and 150 tons of coke per day, its furnaces were producing 1,000 tons of iron and steel per week. The Atlas works was among those who ceased rail production in favour of establishing other markets. It became a specialist in making armour plate for shipping.

This was a lucrative market which also included the making of projectiles, the main customers being the Admiralty and foreign governments. By 1890 they were making nickel steel by both the Bessemer and Siemens methods. Armour plate could be made from 4in to 24in thickness and forged under massive presses, it was chilled and hardened under licence by the Harvey and Tressidor processes.

Such was the armour plate business that a new 10,000-ton press was on order from the Armstrong Whitworth works to work alongside an existing 4,000-ton press. As the decade came to an end the storm clouds of the 20th century began to gather, and soon most steelworks would be quite busy. t

* harryhodson39@ntlworld.com March 2015

HISTORY.indd 1

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