Sti nov dec 2014

November/December 2014 – Vol.38 No.8 – www.steeltimesint.com

MINIMILLS COATINGS SPANISH EQUIPMENT MANUFACTURING

STEEL TIMES INTERNATIONAL – November/December 2014 – Vol.38 No.8

WORLDSTEEL ANNUAL CONFERENCE COVER nov dec.indd 1

11/10/14 10:10 AM

Controlled heating – controlled cooling.

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Phone: +49 211 881-0 Fax: +49 211 881-4902

E-mail: communications@sms-siemag.com Internet: www.sms-siemag.com

07.10.14 15:41

CONTENTS NOVEMBER/DECEMBER 2014

Picture courtesy of MTAG

November/December 2014 – Vol.38 No.8 – www.steeltimesint.com

MINIMILLS COATINGS SPANISH EQUIPMENT MANUFACTURING

STEEL TIMES INTERNATIONAL – November/December 2014 – Vol.38 No.8

WORLDSTEEL ANNUAL CONFERENCE COVER nov dec.indd 1

11/10/14 10:10 AM

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

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2 Leader 4 News The latest steel industry news from around the world 11 India update Get started or else 12 China update Exporting itself out of trouble

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Production Editor Annie Baker

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Maintenance 15 Monitoring lubricant quality Minimills 17 Thinking big at Big River Steel

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

World steel conference 21 Aluminium attacks!

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

25 Extremely challenging times

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

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Advertisement Production Martin Lawrence

SUBSCRIPTION Elizabeth Barford Tel +44 (0) 1737 855028 Fax +44 (0) 1737 855034 Email subscriptions@quartzltd.com

Coatings 29 Simulation studies in Hot Dip Process Simulator (HDPS) on Al-Si Coatings Spanish steel 34 Siderex - Exporting steel and services from Spain’s Basque region

Steel Times International is published eight times a year and is available on subscription. Annual subscription: UK £168.00 Other countries: £240.00

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2 years subscription: UK £302.00 Other countries: £432.00 ) Single copy (inc postage): £38.00 Email: steel@quartzltd.com

Conference report 39 The growing importance of DRI

Published by: Quartz Business Media Ltd,

Perspectives 42 ‘Steel cannot be beaten’

Quartz House, 20 Clarendon Road, Redhill, Surrey, RH1 1QX, England.

Tel: +44 (0)1737 855000 Fax: +44 (0)1737 855034 www.steeltimesint.com

History 44 The transporter bridge

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

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ISSN1475-455X

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Contents nov dec.indd 1

November/December 2014

11/10/14 10:44 AM

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LEADER

All I want for Christmas is a ‘kill and win’ attitude

Matthew Moggridge Editor matthewmoggridge@quartzltd.com

Christmas is ‘comin’ atcha’ and by that I mean the big countdown has started and the shops will soon be full-to-bursting with aggravated shoppers looking for a lastminute bargain. For me Christmas has been a big anti-climax ever since I was forced to substitute train sets and toy guns for socks, shirts and drugstore cologne. I have a problem with the festive build-up because it turns out that Christmas is just another day – and one I have to spend with relatives.

The phrase ‘don’t believe the hype’ springs to mind. It’s not so much Christmas but what precedes it in the shape of television advertising and false bon homie.

The steel industry has had its fair share of hype when it comes to ‘the miracle metal’ – or perhaps that should be ‘the Miracle Metal on 34th Street’ being as Yuletide is virtually upon us.

Christmas came early for delegates at the 48th worldsteel conference in Moscow when Peter Marcus, managing partner of World Steel Dynamics – now making his second appearance in a Steel Times International leader – dished out the best present the industry could hope for – but not before handing out the bad news.

Notwithstanding the fact that the battle

between aluminium and steel for the automotive dollar is a high stakes contest, Marcus told delegates that while the light metal boys are in an ebullient mood, the steel guys have been apprehensive and mystified and, furthermore, have lacked a ‘kill and win’ attitude in relation to the growing presence of aluminium in automotive.

But the good news is that the aluminium industry’s giggles will soon turn to grimaces and Ducker Worldwide’s ‘grandioise forecasts’ will wither in the wind, like a discarded Norwegian Spruce on a cold and snowy mid-January afternoon.

According to Marcus, the ‘soft panache’ surrounding the marketing of the new F-150 truck has concealed the inherent price and cost sensitivities of the light metal.

In short, every dog has its day and where automotive is concerned, steel’s day is yet to come, but it’s on the way – thanks to the continued development of advanced high strength steels; the fact that weight savings do not mean major MPG savings; and, let’s face it, aluminium ain’t cheap – but it’s perfect for wrapping up the turkey before roasting it on Christmas morning.

Monocon International Refractories was founded 40 years ago and have since developed into a global market leader for slag control systems and lances as well as continuing to develop in the field of tundish lining systems and gunning materials. Part of Monocon’s success has been the development of a specialist engineering division that works in synergy with the refractory products so that they can offer customers unique products and services. They employ 120 and have a turnover of approximately £30 million and are based in South Yorkshire. They have recently made substantial investment in a new Technology Centre aimed at expanding product portfolio and enhancement of the current product range.

UK & International Sales Manager Product Managers Competitive Salary + bonus + benefits package Reporting directly into the Chief Executive Officer, and as part of the senior management team, the individual will develop and manage the sales strategy to increase business within existing and new customers through optimising and monitoring the performance of the sales team and agents. This may require recruiting sales personnel across Europe.

Ideally candidates should also meet the following criteria: • Graduate level or similar with strategic experience of running a sales team • Previous experience of the steel production industry • Proven sales track record Ref 102

Competitive Salary + bonus + benefits package – South Yorkshire

The company is seeking to recruit a number of product specialists with a detailed knowledge of the steelmaking process. Of particular interest will be candidates with hands-on experience of the application of refractory products that are used in either continuous casting or secondary steelmaking processes.

Ideal candidates would need the following skills and experience: • A refractory materials background • At least three years previous experience within the steel industry • Be personable and able to work well individually or as part of a team Ref 103

As a Global organisation, the company will offer an excellent salary package commensurate with the level of the appointment. If you have a desire to join this leader in refractories, please email a current CV along with salary details to lesley.staniforth@monocon.com

November/December 2014

Leader nov.indd 1

www.steeltimesint.com

11/11/14 2:06 PM

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4 NEWS IN BRIEF Russian steelmaker boosts mill capacity NLMK Group has completed an upgrade of its continuous widestrip hot-rolling Mill 2000. It now has a capacity of 5.7Mt/yr of rolled steel. The upgrade is part of Strategy 2017, which is all about increasing operational efficiency.

Chinese steelmaker joins worldsteel Hebei Iron and Steel Group has joined the World Steel Association and Yu Yong, the company’s chairman, is now a council member.

Hebei’s membership became official at the 48th World Steel Association conference in Moscow last month.

EU steel imports rise Third country steel imports into Europe rose in July and August 2014, according to the latest EU customs statistics. Finished steel imports have risen 32% year-on-year compared with a 6% rise in Q1 and a 33% rise in Q2.

According to EUROFER, this means that over the first eight months of 2014 total steel imports rose 21%.

Flat product imports grew 15% yearon-year while imports of increased by 49%.

Disappointing results for POSCO There were disappointing Q3 2014 results for Korean steelmaker POSCO. Net earnings were down 60.3% yearon-year to KRW224 billion (US$0.22 billion) on generated revenues of KRW16,270 billion (US$15.9 billion). The company’s crude steel production was up 6.7% year-onyear at 9.5Mt.

INDUSTRY NEWS

Improved operating rates from Nucor mills American steelmaker Nucor says that the overall operating rates at its steel mills increased to 81% during Q3 2014 compared with 79% in Q2 and 78% in Q3 2013.

The company claims that its steel mill utilisation rate increased to 78% during the first nine months of 2014 compared with 74% for the same period last year.

The company claims that during Q3 2014 its total steel mill energy costs increased by roughly US$1 per ton when compared with Q2 2014 and Q3 of 2013. Energy costs for the first nine months of the year increased by US$2 per

ton over the same period last year due to increased gas and electricity costs.

The average cost of scrap and scrap substitute used during Q3 2014 was down 1% to US$379/ ton from US$384/ton in Q2 2014, but up 2% on the Q3 2013 price of US$372/ton.

“Overall operating performance at our steel mills segment for the third quarter was much improved compared to the second quarter of 2014 due to increased profitability in sheet, structural, bar and plate steel,” said Nucor. “Structural steel had no major outages

in the third quarter, as compared to the planned three-week outage at Nucor-Yamato Steel in the second quarter associated with our US$115 million sheet piling capital project.”

The company said that ‘the strongest markets for the steel mills continue to be manufactured goods, including energy and automotive’.

The American steelmaker’s third quarter results were much improved from the second quarter and imports remain at high levels, applying downward pressure on pricing.

US revokes suspension deal The US Department of Commerce’s decision to revoke an outdated ‘suspension agreement’ with Russia has been applauded by the AISI because it means that anti-dumping duties can now be imposed on imports of hot-rolled steel from Russia to the USA. “This agreement, which was entered into 15 years ago, was designed for a different era and is clearly no longer working. Our industry should not have to endure injury from surging imports of Russian hot-rolled steel that are com-

ing into this country under a deal that no longer serves its intended purpose. On behalf of domestic steelmakers, we welcome Commerce’s decision and are grateful for the support of the chairmen of the Congressional Steel Caucus, as well as Congressman Rick Crawford (R-AR), who have urged this action,” said Thomas J. Gibson, president and CEO of AISI. Gibson was also pleased with the decision of the International Trade Commission (ITC) to recognise that the surge in rebar im-

ports has damaged the American steel industry and its workers.

“While we remain disappointed and surprised that the Department of Commerce last month did not provide for full relief against unfairly traded Turkish rebar imports, we are encouraged that today’s vote now clears the way for import duties,” he said on 14 October when ITC commissioners voted unanimously in favour of a complaint brought by leading USbased steelmakers, including Nucor and Gerdau.

Indian steel production growth India’s steel production grew by 1.8% between January and September 2014 reaching 62.41mt, up from 61.27Mt over the same period in 2013. India is currently the world’s fourth largest steelmaker, according to figures released by worldsteel.

Italian PM visits steel plant After a protest rally against Italian prime minister Matteo Renzi’s labour reform plans in Rome, Mr Renzi met with steelworkers at ThyssenKrupp’s Italian stainless steel plant where 550 jobs are to be cut. The German steel giant wants to withdraw from stainless steel production and intends to sell the Italian plant.

November/December 2014

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Siempelkamp, based in Krefeld, Germany, has been awarded the contract to upgrade three presses on the wheel line of Steel Authority of India Ltd’s Durgapur Steel plant. The project includes new electrical and hydraulic controls for all presses, the supply of new mechanical components and a new press frame for the plant’s 20MN dishing press. Siempelkamp is a specialist in engineering and manufacturing metal forming presses.

www.steeltimesint.com

11/11/14 12:35 PM

INDUSTRY NEWS

Tata Steel to sell Long Products Europe Tata Steel is selling Long Products Europe, the company’s long products division, to The Klesch Group.

The aim is to complete the transaction in the first half of 2015.

The steelmaker has signed a Memorandum of Understanding with the company and intends to sell its long products division and associated distribution activities.

According to Klesch, the agreement ‘covers several UK-based assets including the steelworks at Scunthorpe, mills in Teesside and Scotland, an engineering workshop in Workington and a rail consultancy in York, as well as other operations in France and Germany’.

Long Products Europe produces a wide range of standard and differentiated products including sections, rails, wire rods, special profiles and plates for the rail, yellow goods, energy and construction sectors. With approximately

6,500 employees, it currently produces around 3Mt and has the capacity to produce up to 5Mt. Karl Koehler, chief executive of Tata Steel’s European operations said, “We are making huge strides on our strategic journey to become a premium, customer-centred steel company thanks to investment in equipment, technology and customers, together with the substantial contributions from our employees.”

Koehler said that a process of due diligence would now be undertaken but added that ‘no assurance can be given about the outcome’.

“We will regularly engage with our employees and other stakeholders throughout this process, and we will consult with the trade union representatives and work councils,” Koehler said.

According to Koehler the reason behind the sale is that Tata wants

to concentrate its resources on strip products where the company has greater cross-European production and technological synergies.

“We want to build a sustainable business in the UK and further develop our mainland Europe business and we are committed to providing the necessary leadership and financial resources to achieve that,” Koehler added.

Founded in 1990 and headquartered in Geneva, the Klesch Group is a global industrial commodities business specialising in the production and trading of chemicals, metals and oil.

The company boasts revenue in excess of €5 billion, and employs more than 2,000 people across 30 global locations in over 17 countries.

Klesch claims to specialise in acquisitions based on forecasting their future value.

Steelie winners announced The World Steel Association’s fifth Steelie Award winners were announced at the annual dinner of the 48th worldsteel conference in Moscow early last month.

The trophies, known as Steelies, were awarded in seven categories this year.

The categories and winners were: • Steel Industry website of the year: ArcelorMittal (http://corporate.arcelormittal.com) • Innovation of the year: ArcelorMittal Dofasco for spreader beam use • Excellence in sustainability: Gerdau for improving the sustainability of its scrap supply chain • Excellence in Life Cycle Assessment: Tata Steel Europe for the use of LCA to demonstrate the benefits of steel in bridge designs versus alternative materials • Excellence in education and training: Tenaris for development of online learning courses in conjunction with The University of Sheffield and edX • Journalist of the year: John Miller, Wall Street Journal • Industry communicator of the year: Alexey Mordashov, Severstal www.steeltimesint.com

Industry News nov decReadMM.indd 2

The selection process for nominations varied between awards.

In most cases, nominations were requested via the appropriate membership committee and the worldsteel extranet.

All of the entries were judged by selected expert panels using agreed performance criteria except for Journalist of the Year and Communicator of the Year, which were selected by direct vote.

ArcelorMittal’s Lakshmi Mittal receiving the award for Best Website from Dr.Wolfgang Eder, CEO and chairman of Voestalpine

NEWS IN BRIEF

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Intern killed at Nucor steel plant Korey Ryan, an intern, has been killed in an accident at a Nucor steel plant in Tuscaloosa County, Alabama, USA. Plate finishing operations at the mill were suspended and the company, along with state and local agencies, is trying to determine the cause of the accident.

Gerdau engaged in Euro waste project Gerdau’s research and development centre is actively engaged in a European waste energy project. The aim is to see how waste energy in large industrial systems can be used, taking into account the complete energy cycle, says a report by Basque Research.

Iran in negotiation with the Chinese Mehdi Karbasiyan, head of the Iranian Mines and Mining Industries Development and Renovation Organisation (IMIDRO) has said that Iran plans to negotiate with China over its Miyaneh steel project, one of seven steel projects seeking foreign investment. Trade between the two countries is estimated to be worth US$45 billion.

Iranian steel production rises Alloy steel production in Iran hit 225kt for H1 2014, a rise of 17% compared with 2013 figures, according to the Iranian Mines and Mining Industries Development and Renovation Organisation (IMIDRO).

Iran is the second biggest steel producer in the Middle East next to Turkey.

US votes no to anti-dumping The US International Trade Commission (USITC) has voted against a US Department of Commerce decision that grain oriented electrical steel (GOES) from China, the Czech Republic, the Republic of Korea and Russia was being sold at less than fair value in the USA. This means no antidumping or countervailing duty will be issued on GOES imports from these countries.

Collaborative programme A Steel Research & Technology Mission of India is going to be established by the Ministry of Steel to promote collaborative research programmes in the steel industry. The plan is to increase R&D investment in steel from its current 0.2% to 0.3% of turnover to 1% to 2%.

November/December 2014

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6 NEWS IN BRIEF

NLMK output up 4.1Mt NLMK Group’s Q3 2014 highlights include the announcement of a group capacity utilisation rate increase of 2% to 96% and 100% at the company’s main site in Lipetsk.

The company has reported a 9.5% quarter-on-quarter rise in steel output to 4.1Mt but has announced a 2.4% decrease in total sales to 3.7Mt, claiming the latter figure was ‘due to the fact that a part of long products was sold through sales channels with longer periods of revenue recognition’.

A positive pricing trend in the pig iron market has seen NLMK’s semis sales growing by 11.3% to 1.18Mt. Sales grew to 151kt in Q3 2014 compared with just 4kt in Q3 2013. Planned maintenance work at the company’s Lipetsk rolling mill, however, resulted in rolled products sales falling by 7.7% quarter-on-quarter to 2.56Mt. Over a nine-month period, the group's steel output rose by 3.9% to 11.8Mt with group sales up 1.6% year-on-year to 11.4Mt. Sales to the Russian market grew 15% year-on-year to 4.9Mt. NLMK expects steel and rolled product output to decrease slightly in Q4 2014 due to planned maintenance activity because of the seasonal slow down in domestic steel demand.

US Steel iron ore operation cancelled US Steel has decided to cancel plans to expand iron ore pellet operations at Keewatin, Minnesota, and cease with further development of its carbon alloy facilities in Gary, Indiana.

The Keewatin expansion would have increased production capacity by 3.6Mt, taking annual capacity up to 9.6Mt. The plan was to upgrade and restart an idled pelletising line and upgrade the mining, concentrating and agglomerating processes.

Permits required for this expansion expired in September) and won’t be renewed. Additional investments planned for the carbon alloy facilities of the company’s Gary Works will go no further.

November/December 2014

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INDUSTRY NEWS

EU: 43% C02 reduction by 2030 EU heads of state and government have sent a clear message to steelmakers with energy-efficient installations by agreeing not to impose direct or indirect CO2 costs on the most efficient operators competing in the global market.

However, the EU has agreed on what EUROFER describes as ‘an ambitious European Energy and climate policy framework for the period 2020 to 2030, including a CO2 emission reduction target of 43% by 2030 compared to 2005 levels for those industrial sectors covered by the EU Emissions Trading System (ETS).

EUROFER’s director-general Axel Eggert called the new framework ‘extremely challenging’ in the absence of similar constraints ‘for our competitors worldwide’ but

added that EU commitment to safeguard measures at the level of the most efficient installations is a positive signal for industrial investment, growth and jobs in Europe.

“A profitable European steel industry benefits European society as a whole. It will be able to continue contributing to significant emission reductions in Europe.

Our R&D network, our innovations, products and product applications, based on the skills of our employees, are the foundations for a low carbon, energy efficient, and prosperous European society.”

According to EUROFER, “The European Commission should now rapidly implement the safeguard measures and provide sectors at risk of carbon leakage with truly 100% free allocation at the level

of the 10% most efficient installations, based on technically and economically achievable benchmarks, and based on real production instead of historic production levels. CO2 costs passed-through in electricity prices must be fully off-set in all member states.

Referring to less efficient operators, Eggert said that they will have to buy additional allowances on the market. “This gives them the right incentive to improve their carbon efficiency to the level of the benchmarks. If they go beyond those benchmarks by developing and applying innovative, economically viable technologies, they may set new, more ambitious benchmarks”, Eggert says.

See Q&A on page 25.

Latin America’s steel industry Alacero-55, the annual conference of the Latin American steel industry, took place in Mexico City this month, attracting some of the most influential people from the industry who met to discuss the external and regional difficulties facing the industry today.

According to the organiser, Alacero-55 ‘will focus on the importance of ensuring a ‘level playing field’ that allows the Latin American industry to compete according to the guidelines of the WTO and to return to the path of industri-

alisation that leads to sustainable development’.

The conference also examined the role of innovation and new technologies and how steel can ‘continue to provide solutions for a better life’.

Among the speakers at this year’s event were Aryam Vasquez, senior economist for Latin America at Oxford Economics. Vasquez discussed the global economic situation and structural changes affecting the markets and the Latin America region.

Chinese economy specialists evaluated the effects of China’s current economic reforms and their impact on Latin America.

Dr. Edwin Basson, director-general of worldsteel, Nick Sowar, leader of metals sector at Deloitte, and Haiyan Wang, managing partner of the China-India Institute, discussed the overall outlook for the steel industry.

A full report on Alacero-55 will be published in the January/February 2015 edition of Steel Times International.

SMS Siemag has been awarded the contract to modernise a 20-roll cold mill at Outokumpu’s Nirosta plant in Krefeld, Germany. The MB 21BB-61 mill was supplied by SMS way back in 1969. It was modernised in 1991.

The objective of the current modernisation is to update the 45-year-old cold rolling stand and prepare it to deal with ‘demanding new rolling tasks’.

The closure of Outokumpu’s Dusseldorf-Benrath plant has led to its production of thin mirror-finish material being transferred to the Krefeld site. SMS Siemag of Austria is a leading process technology supplier with strong expertise in the development of steel processing systems.

www.steeltimesint.com

11/11/14 12:35 PM

INDUSTRY NEWS

Apparent steel use up 2% Global apparent steel use will increase by 2% to 1.56 billion tonnes in 2014 following growth in 2013 of 3.8%. In 2015 world steel demand will grow by another 2% to 1.59 billion tonnes, according to worldsteel’s short range outlook, which was presented to delegates at the 48th World Steel Conference in Moscow last month.

Hans Jürgen Kerkhoff, chairman of the worldsteel economics committee, said that the positive momentum in global steel demand seen in the second half of 2013 abated in 2014 with weaker than expected performance from the emerging and developing economies. “As a consequence we are issuing a lower steel demand growth figure than our forecast released in April this year,” Mr Kerkhoff said.

The slowdown in China’s steel demand reflected the structural transformation of the economy and contributed significantly to worldsteel's lower global growth projection, said Kerkhoff.

“We have also seen a major slowdown in South America and the CIS countries due to falling commodity prices, structural constraints and geopolitical tensions,”

he said, adding that, in contrast, the developed economies fared well and that recoveries in the European Union, the USA and Japan were stronger than previously thought – but not strong enough to offset the slowdown in the emerging economies.

According to Kerkhoff, steel demand growth in developed economies is expected to be moderate in 2015, while growth in the emerging and developing economies are projected to pick up. He said that China’s rebalancing act will continue to act as a drag on steel demand.

The World Steel Association

says its outlook is ‘prone to risks coming from various fronts’, One such risk is that US interest rates are expected to increase in 2015 and this is likely to impact global capital flows and create instability in vulnerable emerging markets.

Furthermore, China’s transition towards a consumption-driven economy and the recovery in the Euro-Area – constrained by household and government deleveraging – are both causes for concern.

A full report on Hans Jürgen Kerkhoff’s Moscow presentation can be found online: http://steeltimesint.com/contentimages/features/WORLD_STEEL_web.pdf

Summer rise for EU imports

www.steeltimesint.com

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November 09-11 Alacero-55 – The Latin American Steel Congress Hilton, Mexico City.

A conference on the Latin American steel industry, organised by Alacero. For further information, log on to www.mexico55.alacero. org 10-14 Metal Expo 2014 The All-Russia Exhibition Center, Moscow.

A major metals industry event.

For further information, log on to www.metal-expo.ru

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

Third country steel imports into Europe rose in July and August 2014, according to the latest EU customs statistics.

Finished steel imports have risen 32% year-on-year compared with a 6% rise in Q1 and a 33% rise in Q2. According to EUROFER, this means that over the first eight months of 2014 total steel imports rose 21%. Flat product imports grew 15% year-on-year while long products imports increased by 49%.

These figures contrast sharply with only very moderate growth of apparent consumption, says EUROFER. EUROFER’s statistics show that demand for finished steel products in H1 2014 rose almost 5.5% when compared with the same period last year.

DIARY OF EVENTS

Eurofer’s director-general, Axel Eggert

It is expected that growth in apparent steel consumption for 2014 as a whole will rise by 3.5% reflecting the usual seasonal destocking in the second half of the year, underpinning the fact that the rebound in steel demand is only gradually gaining momentum.

“That is exactly the reason why we are so concerned about the sharply rising trend in imports we are observing since the start of the year. Low-priced imports benefit more from the fragile recovery in the EU market than domestic producers. Moreover, the combination of volume and pricing effects exacerbates the already severe margin pressure in the EU steel sector,” said Axel Eggert, EUROFER’s director-general.

21-22 Global Steel 2014 Mumbai, India.

A conference focused upon the state of the Indian steel industry.

Organised by Gujarat NRE and The Economic Times.

For further information, log on to www.globalsteel.in 28-30 CISSE 2014 China International Exhibition Centre, Beijing. Organised by Yheng International Exhibition Co. For further information, log on to www.en.steel-expo.com

January 2015 10-13 Metal Middle East Dubai International Convention and Exhibition Centre. An international trade fair for metallurgical technology.

For further information, log on to www.messe-dusseldorf.de 26-29 Steel Fab Expo Centre, Sharjah, UAE. Middle East trade show for metal working and metal manufacturing and the steel fabrication industry. Organised by Expo Centre Sharjah.

For further information, log on to www.steelfabme.com May 04-07 AISTech Cleveland Convention Center, Cleveland, Ohio, USA A major global steel event.

For further information, log on to www.aist.org For more steel industry news and features, visit www.steeltimesint.com

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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.

Gas consumption 16-20 Nm3/t for commercial steel grades production.

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OMK RUSSIA Two 230-m-long, roller hearth tunnel furnaces for twin continuos casting lines, with slab handling shuttles.

570 t/h productivity for 80-mm thick, 1570 mm wide slabs in low carbon and HSLA steels.

DANIELI THE RELIABLE INNOVATIVE PARTNER TO BE FRONT RUNNERS

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INDIA UPDATE 11

The government of West Bengal has warned JSW Steel & Power to get a move-on with its multimillion dollar Salboni steel and power project in the Indian state. By Dilip Kumar Jha*

Get started or else FACED with unprecedented delays in implementation, the West Bengal government has advised JSW Steel and Power to commence commercial production sooner rather than later at the proposed Salboni steel and power project in the state, 152km from Kolkata, India.

While issuing the ultimatum, state industry minister Partha Chatterjee threatened that further delay would force the government to withdraw land allotted to the company.

The threat assumes significance from the perspective of both the state government and JSW Steel. West Bengal’s chief minister Mamta Banerjee has been known for her anti-industry stance as she came to power through protesting against Tata Motor’s nano plant in May 2011. Since then, hardly any big corporate has announced any major industrial projects in the state. Despite several luring initiatives offered by the existing Trinmool Congress government, captains of industry have distanced themselves from any big investment decisions. As the JSW project is the largest single investment so far in West Bengal, the state government is looking for an early start. From JSW’s perspective, however, iron ore and coal linkages would be better being closer to Jharkhand, one of India’s largest mineralrich states. Since JSW has already invested INR10 billion (US$160 million), withdrawal of land would mean the investment going haywire.

“The government is fed up with the company. It seems they have no intention of taking the project forward. We have waited enough. They (JSW Steel and Power) have been talking about the iron ore problem. But, that is not the state government’s responsibility. They are raising one issue after another,” said Chatterjee.

The project The JSW Steel and Power project is worth an estimated INR 350 billion (US $6 billion).

The plan is to set up a 10Mt/yr steel plant and 1620MW power project. The company signed a development agreement with the then Left Front government in 2007.

The state government granted permission to the company to acquire 4,300 acres of land for the project and acquired the land and leased out around 90% of the land required by the company. The state government allowed the company to acquire the remaining 10% of its land requirement. Following that, JSW acquired 189 acres of land from local farmers but has yet to sign the lease documents.

There has been bitterness between the government and the steel company on various issues. Two years after signing the development agreement, the government wanted JSW to sign another supplementary agreement skewed towards the state. In August 2012, the company came close to signing but was prevented from doing so by some niggling issues.

The land acquisition process displaced over 400 families that still await one

family member’s job in the project as promised by both the company and the government. However, the project is yet to start and the displaced families are struggling for survival. Protecting their interests, therefore, Chatterjee urged the company to pay INR 5000 (US$82) a month to the affected families until they are given employment.

The minister threatened that if JSW was not interested then the government would take back land from the company and allot it to an alternate investor.

“We are committed to the project. The group has incurred a massive investment so far and we are waiting for iron ore linkage. Meanwhile, the company has already initiated setting up an integrated power plant for which a formal proposal has been submitted to the state government. This indicates that we are serious about the project,” said Biswadip Gupta, managing director of JSW Bengal.

The withdrawal of land from JSW Steel and Power would be a big blow to the company, which would impact any future greenfield projects elsewhere in India in the future. t

History of disagreement Timeline

Progress

2004

Sajjan Jindal announced revival in Salboni Steel and Power project

September 2006

Jindal revives steel project on a much larger scale

January 2007

JSW signs development agreement with the Left Front government

May 2007

JSW gets permission to possess 4,300 acres land at Salboni

November 2008

Foundation stone laid

August 2, 2011

Mamta Banerjee expresses disapproval over project delay

August 5, 2011

Government raises questions on land purchase

August 10, 2011

Government takes back land, to lease it back to company

September 10, 2011

Sajjan Jindal meets state chief minister Mamta Banerjee, assures all issues to be settled

November 1, 2011

Government decides to legalise private land acquisition

January 2012

JSW signs lease agreement with land reforms department for 3,800 acres

July 11, 2011

Government resolves differences, fixes August 9 to sign lease agreement with the West Bengal Industrial Development Corporation

August 2012

JSW raises concern about iron ore sourcing, JSW yet to sign the supplementary agreement for the project

* India correspondent www.steeltimesint.com

INDIA UPDATE NOV.indd 1

November/December 2014

11/5/14 4:07 PM

12

CHINA UPDATE

Exporting itself out of trouble?

Can steel exports offset losses from rising production? Shi Lili* reports ACCORDING to China’s National Bureau of Statistics, crude steel production from January to August 2014 of 550Mt represented a gain of 2.6%. Steel output for the period jumped 5.4% to 742Mt and the production of pig ore during the same period rose 0.5% to 483Mt. In contrast, the average price per tonne of steel dropped from 4,468 yuan (US$730) in 2012 to 3,212 yuan (US$524) during the first half of this year.

In response to the Chinese government’s policy of cutting energy consumption, steel production still achieved record highs because although one region reduced production, others restarted theirs and raised output. Take Hebei Province and Jiangsu Province as two examples: in July steel capacities in Hebei dropped 6Mt when compared with last year.

Meanwhile, in Jiangsu, capacities rose by 8Mt. The local Hebei government used its influence to shut down and upgrade certain facilities while Jiangsu took the chance to improve its market share.

Market adjustment and government forces play a major role where surplus capacity is concerned and steel exports are back on the agenda. According to Platts, Chinese steel exports to July 2014 reached 49.07Mt, an increase of 37% compared with the same period last year. It is projected that China’s steel exports will reach a record high this year and might alleviate surplus capacity in the domestic market.

Rising exports, trading conflicts The domestic steel market in China is dogged with record surpluses, but there are still many hard nuts to crack. Chinese steel mills are constricted by international trading conflicts due to the huge price differential. The average sales price of domestic steel products for export is much lower than imported products. Trading

conflict is familiar territory for China, especially after the economic crisis when foreign steel markets stayed flat and there was an abundance of anti-dumping cases as foreign governments sought to protect their domestic industries.

China’s average import price for steel products in July 2014 was US$1,285/ tonne, up US$9/tonne from last month, which indicated a continuous increase over four months and a record high for 21 months. The export price was US$786/ tonne, which differed considerably from the import price of US$500.

Since early September, there were eight anti-dumping cases against China’s steel industry. Trading protection policies outside of China began popping up after the downturn. In 2013, trading conflicts covered pipes, galvanised products, hot rolling, cold rolling stainless, electric steel, steel wire rod and so on, with steel pipe accounting for as much as 31% and galvanised and hot rolling accounting for 22% of cases. Trading conflict spread from developed to developing countries.

Challenges from Japan and Korea China’s steel exports face challenges from Japan and Korea. Just over 15% of China’s steel exports went to South Korea in 2014.

China’s low steel prices are due to low and inconsistent quality. In 2011, 61.1% of crude steel was of low-to-medium quality and certain products were of the same quality as those produced by developed countries in the 1980s.

China, Japan and Korea have set up a steel trading circle and ASEAN is striving to develop its domestic steel business.

However, despite rising steel imports, trading conflicts have prompted Chinese producers to invest abroad or set up joint ventures (JVs), which have threatened the market share of Japanese and Korean suppliers. Such competition is set to

continue and yet the technologies and management of Japanese and Korean steel mills are far more advanced than those in China and have already established both upstream and downstream JVs in neighbouring countries.

Exports won’t help The key difference between Chinese and foreign steel producers lies in the fact that the former always own several mines. The ownership of steel mines in China goes back to when state-owned enterprises tried to take control of raw materials by adopting a policy of producing steel using their own iron ore. In other words, they owned the entire process. However, on the international market, such a proposition may not be competitive when compared with overseas players and the overall mining costs may be higher than buying and shipping iron ore from elsewhere.

But having such a vast industrial infrastructure is not easy to divest and is costly to maintain, leading to financial losses and surplus capacities.

Most state-owned steel producers are major taxpayers at a local level and the very pillars of the local economy since they provide employment for local people.

Idling or shutting down ‘backward’ capacities, therefore, has a big impact on local GDP including unemployment and environmental issues.

To break this vicious circle, it is inevitable that Chinese steelmakers in this position will take the path of industrial upgrading rather than closing down.

While the domestic market in China remains flat, the only real solution is to look at the overseas market where competitiveness depends on quality rather than quantity. It is crucial that domestic mills reduce their capacities of low grade steel and increase that of quality steel products. t

*China correspondent November/December 2014

CHINA UPDATE ReadMM.indd 1

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15

Monitoring lubricant quality Oil analysis programmes help maintenance professionals extend the life of their equipment and minimise unscheduled downtime. By Jarmo Vihersalo*

STEEL companies, now more than ever, are putting heightened emphasis on achieving operational and cost efficiency. It is becoming more common for managers and engineers to be given incentives for increasing plant productivity and, as a result, maintenance professionals are incorporating proactive strategies to help them achieve their production goals.

Oil analysis is one of the most popular maintenance programmes being implemented at present and it consists of a series of tests to determine the condition of equipment components and in-service lubricants. Oil analysis helps maintenance professionals extend equipment component and lubricant life by providing early warning signs of contamination to help minimise unscheduled maintenance.

Back to basics There is a certain protocol that should be followed to help ensure the accuracy of oil analysis results. First, maintenance professionals should always use a clean, dry container to draw oil samples. Any particles that are in the container before the oil sample is collected could result in an inaccurate result. Most oil analysis companies provide sample collection canisters.

Maintenance and production engineers should draw samples from equipment at its normal operating temperature and when the machine is in use or online. If online is not possible, it is acceptable to draw samples within 30 minutes of equipment shutdown.

Oil samples should always be taken in the same manner and from the same sampling point. A sample can be taken from the tubing from the reservoir or sump, the valve on pressurised return from system (prior to the filter), the valve on pressurised supply to system (prior to the filter), the valve on reservoir wall, the special fitting or the drain from reservoir or sump (valve or plug).

To identify the most appropriate sample point, it is imperative to consult with your oil analysis provider and machine manufacturer for application-specific

advice. Once the location has been identified, it should be noted in the maintenance records so that samples can always be taken from the same place.

This will ensure that results from the analysis of sequential used oil samples can be compared and trended to provide accurate insight into equipment and lubricant condition.

Oil samples should always be taken before equipment is drained. If the oil has been drained, samples taken, and then deemed acceptable for continued use, there is no way the product can be re-used for components such as hydraulics and gearboxes. Also, do not sample a machine immediately after an oil change or after a large amount of make-up oil has been recently added.

Maintenance professionals are advised to always set sample intervals so equipment issues can be detected early.

Sampling is usually less costly than repair or lost production. Industry standards recommend sampling every quarter.

However, more frequent sampling is recommended if there are abnormal levels of wear or contaminant elements, vibration readings are increasing, there is an increase in temperature through the fluid system after an overhaul or a pump change out, or when new pieces of equipment are put into service.

Application-specific expertise Selecting an oil analysis partner that has application-specific expertise and strong relationships with original equipment

manufacturers (OEMs) is extremely valuable. OEMs establish proprietary control limits based on the equipment model, lubricants used, applications and operating environments. When compared against the oil analysis results, these predetermined safeguards help maintenance professionals make the best informed decision about the condition of the lubricant and the equipment.

Copper is often detected in used oil analysis from hydraulic systems. Pumps often use copper alloys, and shell and tube heat exchangers are commonly made with copper or copper alloy. These materials come into contact with the hydraulic fluid and, given the right conditions, copper may dissolve into the oil.

Elevated copper levels (typically less than 500 ppm) may be identified in as little as 50 to 250 hours of run time. Research indicates that copper content levels off with continued operation and does not affect the performance characteristics or oxidation stability of the fluid.

Online efficiency Most analysis companies offer some level of online functionality so itâ&#x20AC;&#x2122;s important to evaluate oil analysis partners based on how they can help expedite the administrative process of oil analysis. Tasks such as managing/updating equipment registration, printing completed labels for sample bottles, ordering additional sampling kits and confirming delivery of samples can be simplified using online tools. Online programmes can also arm maintenance professionals with the proper tools to make more informed decisions.

Long-term success Selecting an oil analysis provider that has application-specific expertise, intimate relationships with OEMs and a comprehensive online oil analysis offering will help plant maintenance professionals achieve their companyâ&#x20AC;&#x2122;s production goals as well as their own. t For further information, www.mobilindustrial.com

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* Europe, Africa and Middle East Industrial marketing advisor for energy, ExxonMobil Fuels & Lubricants www.steeltimesint.com

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November/December 2014

11/5/14 4:18 PM

MINIMILLS

17

Thinking big at Big River Steel John Correnti, CEO of Big River Steel in the USA doesn’t like the term ‘minimill’ and who can blame him when his company has massive ideas for the future. Correnti would rather think of his EAF facility at Osceola, Arkansas, as a flexi-mill, reports Myra Pinkham*

THE idea of building a bigger, better, lower cost mousetrap is not new to steel industry veteran John Correnti and he says that is his intention with his new $1.3 billion electric arc furnace (EAF)-based Big River Steel LLC steel mill in Osceola, Ark., which broke ground in early August and plans to begin commercial production early in 2016.

Despite concerns to the contrary – and several attempts to halt its operation, including several lawsuits from Nucor Corp., which has a steel minimill facility not far from Big River in Hickman, Ark. – Correnti maintains that at the end of the day his new mill will only have a 15% to 35% overlap with other US EAF steel producers – with that percentage declining over time.

“We don’t want to knock heads with the other steel minimills,” Correnti, who is Big River’s chief executive officer, declares, admitting that other US electric steelmakers also have very efficient operations.

Helped by new ‘bells and whistles’ from its equipment supplier SMS Siemag, Big River does not plan to stress the traditional commodity steel products that are often associated with minimills, but rather several high-end niche markets, such as advanced high strength steels (AHSS) and electrical steels, which are usually more associated with integrated steelmakers.

Fits and starts Big River Steel, which Correnti admits has been progressing in ‘fits and starts’ over the past three years, firmed up its financing June 30, 2014 and within weeks began site preparation for the mill, which is to be brought on-stream in as many as three phases.

Correnti says he is building upon what he learned when developing a minimill

John Correnti and Mark Bula break ground for the new Big River Steel minimill

in Columbus, Miss., talking about the company originally known as SeverCorr LLC before it was purchased by Severstal North America and just recently taken over

by Steel Dynamics Inc., Fort Wayne, Ind. He says that EAF steelmaking facility uses the SMS compact strip production (CSP) process in order to produce steels for the automotive and other high-end markets, cheaper, both from an energy

and capital standpoint.

Now, with further improvements of CSP technology, Correnti plans to produce a combination of commodity grade and highly advanced flat-rolled steels – including AHSS, coiled plate and electrical steels, many of which had previously only been produced by integrated mills using a blast furnace.

“Of course we are also going to produce

* USA correspondent www.steeltimesint.com

MINIMILLS MYRAReadMM.indd 1

November/December 2014

11/11/14 12:37 PM

18

MINIMILLS

Site preparation is almost complete for the new Big River Steel minimill

commercial quality hot rolled, cold rolled and galvanised steels as well, including the structural grades that are used by the construction sector and the high strength low alloy (HSLA) grades that are not uncommon to be produced by the EAF steelmaking process,” Mark Bula, Big River’s chief commercial officer, admits, “But we are also planning to produce those grades in slightly higher yield strengths than are commonly produced at some other mini-mills.”

But even in the company’s already approved Phase 1, which will give them the capability to produce a total of 1.6Mt of steel, Big River plans to produce certain niche products that have previously only been produced by integrated steelmakers.

Moving forward Bula says that should investors be satisfied that the company’s management team has lived up to its responsibilities and commitments in building phase one on time and on budget and if there is favourable market demand at that time, Big River plans to go forward with its phase two and phase three – possibly simultaneously – shortly after phase one construction is completed.

“At the end of the day all the customer cares about is the quality and the price of their steel, not whether it is produced by an EAF or a blast furnace,” Correnti maintains, adding that he believes that the spirit of innovation that is part of Big River

Steel types

Thickness

Width

Hot roll black

.054 min - 1.0 max

36” to 76”

Hot roll picked & oil

.054 min - .160 max

36” to 74”

140,000 tons

Cold roll ML/NGOSP

.012 min - .095 max

36’ to 74”

323,810 tons & 198,198 tons

Galvanised

.012 min - .095 max

35.5” to 73”

428,942 tons

Steel will give them precisely what they are looking for. “We have to be a low-cost producer of high quality steel,” he says. “If not we will be out of business,” which is something he does not intend to happen.

Innovation matters He says that innovation is at the core of Big River’s business philosophy, as is the intention to hire great people, give them the best technology.

“It is innovation that matters,” Bula says. “If you don’t innovate you are going to die. In fact, we believe that it is only through technological innovation that we can ensure that the United States remains at the forefront of steelmaking,” he says.

One key innovation is the use of a RH degasser, as opposed to tank degassers used by most domestic mini-mills. The RH degasser, says Correnti, allows for more efficient and faster removal of carbon and hydrogen for higher quality steel grades, enabling Big River to make more sophisticated steel grades.

Another is the higher temperatures of its tunnel furnace, which is expected to result in better properties and higher yields for

Extra Deep Drawing Steel (EDDS) or IF & DDS, DS

HR, CR, HDG

Commercial Steel (CS), Low, Medium & High Carbon

Various

HR, CR, HDG

Structural Steel & Cor-Ten A & B Stee

Construction

HR, CR, HDG

High Strength Low Alloy (HSLA)

Transportation, construction

HR, CR, HDG

Advanced High Strength Steel (DP, CP, MS, FB)

Transportation

HR & CR

High Carbon

Manufacturing, transportation

HR only

Quenched & Tempered, Abrasion Resistant, Pressure Vessel

Construction vehicles, shipbuilding,

HR only

OCTG Steel - API & Sour Gas

Automotive, service centres, almost all these

Petroleum, energy products

CR only

Cold Rolled Motor Lamination (full range)

Fractional motors

CR only

Non-Grain Oriented Semi-processed (NGO SP)

Electrical transformers

pressure vessels, containers

November/December 2014

MINIMILLS MYRAReadMM.indd 2

457,500 tons

Basic product capabilities and capacities once Big River is fully ramped up and producing 1.6Mt of steel

HR, CR, HDG

Big River Steel’s product range and end markets

Planned capacity

silicon steels.

The steelmaker plans to have a number of other unique capabilities, including the ability to produce slab thicknesses of up to 3.5 inches, which allows for larger final hot strip thicknesses, reduced surface imperfections and improved toughness for steels to be used for API energy pipe applications. The mill will also be 76 inches wide, the widest of all minimills in the United States. Big River says this will be an advantage in the coiled plate market, specifically for plate used by heavy equipment manufacturers. It also has a longer run-out table with better cooling capabilities, which improves surface quality and helps the company meet the higher strength grades it intends to make.

Big River also has logistical advantages, Bula says, noting that the 1,300 acre site is bordered by the Mississippi River on one side with direct access to the Burlington Northern Santa Fe (BSNF) Class 1 railroad and a major interstate highway nearby.

Not solely focused on silicon steels Building the mill in several phases makes common sense, says Bula. “To build a mill for silicon steels and grain oriented electrical steels (GOES) with the lower cost structure EAF process, you have to first justify it with some kind of carbon plant,” he explains. “You can’t build a mill solely focused on silicon steels.”

Big River’s Phase One will include the installation of one EAF, one cast, a hot mill, a pickling line, a cold mill and a galvanising line enabling it to produce commercial grade hot rolled, cold rolled and hot dip galvanised (HDG) steels; hot rolled, cold rolled and HDG extra deep drawing steels; hot rolled, cold rolled and HDG structural www.steeltimesint.com

11/11/14 12:37 PM

MINIMILLS

19

steel; hot rolled, cold rolled and HDG high strength low alloy steel; hot rolled, cold rolled and HDG advanced high strength steels (AHSS); hot rolled and cold rolled high carbon steels; hot rolled quenched and tempered, abrasion resistant and pressure vessel steels; hot rolled API and sour gas oil country tubular goods (OCTG) steels; a full range of cold rolled motor lamination steels; and cold rolled non-grain-oriented semi-processed electrical steels.

Capacities It is expected to have the annual capacity to produce 475kt (short tons) of 0.054 inch to 1.0 inch thick, 36 inch to 76 inch wide black hot roll; 140kt of 0.054 inch to 0.160 inch thick, 36 inch to 74 inch thick pickled and oiled hot roll; 323kt of 0.012 inch to 0.095 inch thick, 36 inch to 74 inch cold rolled; 198kt of 0.012 inch to 0.095 inch thick, 36 inch to 74 inch motor lamination and cold-rolled, non-grain-oriented semi-processed electrical steels; and 428kt of 0.012 inch to 0.095 inch thick, 35.5 inch to 73 inch wide galvanised steel.

Currently the only AHSS that mini-mills make are dual phase steels, Bula maintains. He says that Big River will also have the capability to produce multi-phase and martensitic grades.

Likewise, it will not only make X-55 OCTG steels, but X-70 and X-80 too.

Second construction phase That, Bula says, will very likely be followed by a second construction phase that will enable the company to produce fully processed grain-oriented (GO) and non-grain oriented (NGO) electrical steels, which would require its own cold mill facility as well annealing furnaces, rolling mills, cold mills and temper mills specifically designed to produce GO and NGO electric steels.

The third phase, which Bula says could be undertaken at the same time as phase two, would include another EAF, a second ladle metallurgical station, additional caster, additional galvanising line and, potentially, a seventh stand for its hot mill.

Niche markets In addition to benefiting from expected growth in its key enduser markets, including automotive, energy, coiled plate and the electrical sector, Big River will likely displace some imported steels as well as taking market share from existing domestic integrated and minimill steelmakers.

A flexmill more than a minimill While unwilling to give a specific breakdown, Bula says that in the company’s niche markets of coiled plate, API steels, AHSS, cold rolled motor laminations and semi-processed NGO electrical steels, more market share will be taken from integrated and foreign producers than domestic mini-mills.

“This is simply because these niche markets are more heavily supplied by the integrated mills due to their equipment advantages versus traditional minimills,” Bula explains. “This is the advantage of Big River Steel, as we are more of a ‘flex mill’ than a minimill,” he says, defining a flex mill as being a steelmaker with the cost and business structure of a minimill and an equipment and product mix that is more closely aligned to an integrated producer.

Even beyond its current plans, Bula says Big River expects to continue to innovate and grow not just through internal capital investments, but also mergers, acquisitions and joint ventures.

The next edition of Steel Times International asks the world’s leading steelmakers and process technology suppliers about their hopes and fears for 2015. Email your thoughts to matthewmoggridge@quartzltd.com

www.steeltimesint.com

MINIMILLS MYRAReadMM.indd 3

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WORLD STEEL CONFERENCE 21

Aluminium attacks!

Peter Marcus, managing partner of US-based World Steel Dynamics, argues that the steel industry has been late in reacting to the threat posed by aluminium in the automotive industry and has lacked the ‘kill and win’ attitude needed to take on the miracle metal…but all is not lost.

By Matthew Moggridge* AT a recent and unspecified steel conference Peter Marcus, managing partner of World Steel Dynamics, told delegates that he had been studying the steel industry for 54 years. How, he wondered out loud, could he convey all of his knowledge to his audience in the space of 25 minutes? The answer from the back of the auditorium was ‘speak slowly’.

Marcus related this tale to delegates of World Steel-48, the annual conference of the World Steel Association, held last month in Moscow. He was in town to discuss aluminium versus steel in the automotive industry based on a World Steel Dynamics report entitled AutoBody Warfare: Aluminium Attack.

The report follows hot on the heels of remarks made at American Metal Market’s Steel Success Strategies in New York in September by ArcelorMittal’s CEO Lakshmi Mittal. In addition to describing steel as the very ‘fabric of life,’ Mittal had plenty to say about the role it will play in the automotive industry going forward.

According to Mittal, the automotive market ‘is set to boom’. He said that current comparisons between aluminium and steel were ‘not proper’ because they rely upon a certain quality of steel and that things have moved on considerably since those comparisons were first made.

Steel, said Mittal, can provide all the weight reduction that auto producers require to satisfy new fuel efficiency standards.

The standards in question are the US Government’s CAFÉ standards, which are looking for 54.5 miles per gallon by 2025.

According to Peter Marcus’ latest report, ‘although it will become far more costly in the next decade for the automotive companies to implement the CAFÉ standards, the mandate has been accepted by the automotive industry and its suppliers’.

Marcus describes the battle between aluminium and steel for the automotive dollar as ‘a high stakes contest between the world’s leading steel and aluminium companies’, but argues that, while the aluminium industry is in an ebullient mood in relation to the automotive industry, steel mills – particularly those in the USA – are apprehensive and mystified.

Furthermore, they lack what Marcus described to journalists in Moscow as a ‘kill and win’ attitude.

According to Marcus, aluminium is the enemy of steel and Ford’s decision to rely upon the light non-ferrous metal for the body-in-white of its F-150 truck was a ‘shocking event’. What was the thinking behind the decision, Marcus

asked rhetorically, bearing in mind that aluminium is more expensive than steel and the automotive industry is notoriously price-sensitive?

One reason, he said, was that the F-150 was heavier than its peers but also that Ford was influenced by Jaguar and Rolls Royce’s use of aluminium. “This partly explains some of the economic irrationalisation,” said Marcus, adding that the automotive industry was like the space industry: constantly pushing the technological boundaries ‘outside of the boundaries of reason’.

There was also, he said, a degree of ‘soft panache’ surrounding the marketing of the new F-150 truck that has concealed the inherent price and cost sensitivities of the light metal. “With the advent of new steel grades and some attitude, economics dictate that steel will, at minimum, defend its turf to 2018,” said Marcus.

He described Ducker Worldwide’s ‘grandiose forecasts’ – that by 2025 three-in-four pick-up trucks will have an all-aluminium body – as reinforcing the optimism of the aluminium industry over the F-150. “This truck is viewed by the aluminium companies as the watershed event portending far higher aluminium automotive sheet consumption in the future,” says World Steel Dynamics.

* Editor, Steel Times International www.steeltimesint.com

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WORLD STEEL CONFERENCE

Aluminium versus steel – the industry’s perspective

“There is no doubt that aluminium offers a number of advantages, but HSLA steel combined with heat treatment can offer weight savings and strength-to-weight ratios that will compete with aluminium on a cost-per-piece basis.”

Michael J Klauck, president, CAN-ENG.

“With the continued evolution of advanced highstrength steels, aluminium can no longer claim victory on weight alone.

And it certainly can’t claim it on strength-toweight ratio or stiffness, let alone weldability, or the ability to connect parts.”

Ron Ashburn, executive director, Association for Iron & Steel Technology.

In fact, WSD goes further and suggests that Ducker Worldwide has been bigging up and overstating aluminium’s automotive sheet delivery potential in 10 years from now. “For example, it is claimed that three-fourths of the light trucks by 2025 will have aluminium bodies, which WSD thinks is far-fetched.” And, furthermore, “The [Ducker Worldwide] report does not provide data on weight reduction requirements to meet CAFÉ standards after improvements in engine performance.”

In Moscow, Marcus argued that the frenzy behind building aluminium rolling mills is based on the claims of the Ducker Worldwide report.

The bigger question, however, was why the steel industry has been so late in reacting to the threat posed by aluminium? According to Marcus, the automotive industry doesn’t like to rely upon one supplier. In 2009 there was only one ‘special steel’ on the market and many steel companies were playing ‘catch up’ in terms of research and development in an effort to establish a level playing field – in other words, create more suppliers of special steels. The situation, he said, was not competitive, but the tide has started to turn.

Marcus highlighted how the steel industry has set its wheels in motion in an effort to gain back territory ‘lost’ to aluminium, citing the recent acquisition

by AK Steel of Severstal’s North American November/December 2014

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“I think the competition with aluminium in the auto industry is driving innovation in the steel industry.”

Kevin Guay, senior sales engineer/ research and development, Plattco.

“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 Americanproduced light vehicle.”

Jay Baron, president, Centre for Automotive Research.

operations for US$650 million.

In the executive summary to AutoBody Warfare: Aluminium Attack, he goes further and mentions the ArcelorMittal/ Nippon Steel Sumitomo Metals Corporation purchase, for US$1.95 billion, of ThyssenKrupp USA’s 5.2Mt/yr rolling mill facility that is designed to ship more than 2Mt/yr of automotive steel.

Then there was Severstal North America’s state-of-the-art EAF-based sheet mill in Mississippi, purchased for US$1.6 billion

by Steel Dynamics and designed to produce automotive sheet. He mentions Big River Steel’s new EAF-based thin-slab flat-rolling plant under construction in Arkansas at a cost of US$1.3 billion – a key market for the plant is automotive.

Nucor’s recent US$770 million acquisition of the Gallatin thin-slab flatrolling mill in Ghent, Kentucky, could be expanded to serve the automotive market, claims World Steel Dynamics, as there is room on-site for a new steelmaking and rolling mill complex. The riverside location is said to be ideal and there might be potential for building a DRI facility, as the transportation costs for iron ore pellets might prove restrictive.

Other notable examples of how the steel industry is tackling aluminium’s supposed future domination of the automotive industry include Ternium’s new state-ofthe-art cold rolling and galvanising facility near Monterey in Mexico – a project

“The main target for OEMs is to produce cars that are consuming less energy and they are talking about multi-lateral lightweighting. The driving force is to use aluminium to achieve their targets on emissions and fuel consumption and we see big opportunities in that respect.”

Svein Richard Brandtzaeg, CEO, Norsk Hydro.

“Steel was so deeply integrated into the way things were, but then Jaguar Land Rover made one of the first aluminiumintensive vehicles.

That was the first time an OEM went through and produced for volume manufacturing and it’s been a success.”

Phil Maartens, CEO, Novelis.

undertaken alongside Nippon Steel Sumitomo Metal Corporation; POSCO’s two galvanising lines at Altimira, Mexico; and US Steel and Kobe Steel’s Leipsic, Ohio, US$400 million Pro-Tec coating line, started in May 2013 and designed to process cold-rolled coil into high-strength and ductile forms of the product.

In 2014 deliveries of aluminium sheet totalled 504 million pounds, claims World Steel Dynamics. By 2018 it is expected to reach a staggering 2.68 billion pounds due to ‘significant growth’ in aluminium closures and ‘surging deliveries’ for the F-150 truck.

That said, World Steel Dynamics further claims that steel products can easily meet CAFÉ’s weight-saving requirements for 2018 and 2021 as, by then, ‘a wider array of advanced high strength steels (AHSS) will be available’. Engine design improvements, claims WSD, will make weight saving requirements in 2018/2021 ‘not particularly severe’.

There are plenty of other factors that make for good reading if you’re a steelmaker worried about the rise of aluminium in automotive. In summary, these are as follows:• Aluminium sheet deliveries are likely to peak in 2018 due to higher build costs and the ‘sizeable and relatively low-cost weight savings’ achievable using AHSS. • Weight savings do not mean major MPG improvements. www.steeltimesint.com

11/19/14 9:19 AM

WORLD STEEL CONFERENCE • Aluminium sheet is not cheap.

• Ford may regret opting for aluminium in the F-150 truck: ‘it may pay a price in terms of reduced profitability’.

WSD claims that, since Ford decided to opt for aluminium for the F-150’s body-in-white, things have moved on technologically in terms of steel processing. Back in 2009, for example, continuous annealing lines (CALs) didn’t exist.

Furthermore, Ford might have to pay an extra US$1,000 to US$1,400 per vehicle to build an aluminiumbodied light truck based purely on the price differential between steel and aluminium.

There are also question marks hanging over the F-150’s sustainable competitive advantage when compared with rival truck brands in the US market, such as the GM Silverado and the Chrysler-Dodge RAM truck. Both brands might be as light and better performing, claims WSD, in 2017/18 than the 2015 F-150.

With fewer suppliers of what WSD calls ‘difficult-to-make’ AHSS grades, it is argued that US-based steel mills should make a higher profit margins on deliveries. This theory is backed up by recent consolidations in the steel sheet market as plants previously owned by ThyssenKrupp USA and Severstal North America have been acquired by existing producers (ArcelorMittal, Nippon Steel & Sumitomo Metals Corporation, AK Steel and Steel Dynamics).

It is also argued that AHSS – even if priced 25% higher than average automotive sheet products – gives

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aluminium a run for its money where weight savings are concerned.

WSD also claims that not all automotive OEMs are switching to aluminium, citing the likes of Cadillac, Tesla, Volvo, BMW, Honda and even Ford as companies making increased usage of AHSS. On the bad news front, US investment in aluminium rolling mills and heat-treating lines might lead to an oversupply situation and this, says WSD, will enable aluminium mills to enjoy good ‘pricing power’ and, therefore, the ability to pass on costs to customers.

WSD also argues that automotive steel sheet deliveries in 2025 might be flat compared to 2014 even if car production is up 20% over the period.

This is due to losses to aluminium and less weight per vehicle.

While WSD expects automotive sheet deliveries to be around 42.7 billion pounds, this figure masks declines in mild sheet deliveries and a rise in delivery of AHSS. Mild sheet will drop from 2014’s figure of 22.7 billion pounds to just 8.3 billion and mid-strength steels from 12.5 billion pounds to 10.7 billion. High strength steels, however, will rise from 7.4Mt to 23.7Mt, up 330%.

Perhaps the last word should go to Ducker Worldwide’s Dick Schultz.

While he has been accused of making ‘grandiose forecasts’ and ‘reinforcing the optimism of the aluminium industry over the F-150’ he has also been quoted as saying, “While there will be increased aluminium penetration, vehicles will continue to be predominantly steel.” t

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Extremely challenging times The EU recently announced that its CO2 emission reduction target by 2030 is 43% – but does the technology exist to achieve it? We caught up with EUROFER’s director-general, Axel Eggert, at worldsteel’s 48th annual conference in Moscow to find out.

1. You’re taking over from Gordon Moffat as Director-General of EUROFER. A hard act to follow?

Gordon Moffat has considerably strenghtened the voice of the European steel industry in Europe. It is, of course, a challenge to follow in his path, but this work is not a new field for me. I have worked since 2007 in a leading position at EUROFER as director for public affairs and have represented Gordon Moffat on many occasions in the past.

2. What will be the main challenges facing the European steel industry over the next 12 months?

The EU’s ambitious climate and energy framework for 2030 is certainly among our main challenges. It is essential that our industry, at least at the level of the most efficient installations, will not be penalised with costs, which our global competitors do not have to bear.

3. Gordon Moffat said that taking an ideological approach to climate change is wrong. What’s your view?

I would agree to this. Decisions must be based on facts and realistic impact assessments. It is clear that climate change has to be addressed with appropriate measures on a global level. Crucial is that the EU does not continue a unilateral policy regardless of technical and economical feasibility for the steel industry.

4. It is argued that the steel industry cannot hope to meet EU emissions targets as the technology simply doesn’t exist to improve matters any further at present. How can EUROFER convince those in power that this is the case?

Indeed, after having reduced CO2 emissions from EU steelmaking by 50% since the 1970s little further potential with existing technologies remains. European steelmakers are the most advanced in R&D into innovative steelmaking technologies.

But these do not fall from the sky and once available also need to be economically viable. Equally important, EU steelmakers are delivering steel products for emission

reductions at a magnitude of, potentially, at least 450Mt of CO2 per year by 2030 in the EU alone. EU politicians have already acknowledged that steel made in Europe is essential for the EU’s economic fabric, jobs and growth. Now it is up to the politicians to deliver the right regulatory framework for a globally competitive industry in Europe.

5. With regulatory costs eating into the profits of European steel producers, is it time to say ‘enough is enough’?

7. “I don’t believe anybody is talking about new capacities in Europe.” This is a quote from Gordon Moffat earlier this year. Is this sorry state of affairs likely to change in the near future – or get worse?

There are indeed no new capacities in the EU in sight. The European steel industry is continuing to restructure and adapt existing capacities to economic realities.

We are indeed at a turning point. The EU needs to make the right decisions now if it wants the steel industry to further invest in Europe. The awareness among many politicians is there, but clear action is missing. We hope that the new European Commission with a new focus on growth, jobs and better regulation will meet the expectations and find the right balance between economic and environmental policies.

6. Uncertainty surrounding increasingly stringent EU climate change regulations has led to a deadening of investment in Europe by the European steel industry. Will European steelmakers take their business elsewhere?

It would be unfair to point on EU climate regulation as the only reason for declining investment in Europe. The economic crisis, high energy prices and regulatory and administrative burdens in Europe have a huge impact, too. On climate policies it is in particular the forecasted unilateral cost impact on our industry that removes the incentive to invest in Europe. With even the most efficient steel plant in Europe having a huge cost burden, carbon and investment leakage will be the inevitable consequence with negative impacts for the climate and environment on a global scale.

www.steeltimesint.com

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With the right regulatory framework and a business friendly environment, steelmakers in Europe will remain world leaders in providing indispensible steel products for modern societies and future generations.

8. It is argued that there has been a massive policy failure in Europe over the past decade in terms of energy security. Big cost miscalculations have been made over green policies, for example. What’s the solution?

Europe needs to keep a diversified energy mix with energy providers and energy sources competing in an EU energy market instead of being subsidised on a national level. Europe needs to be open towards the sustainable exploitation of domestic energy sources, including shale gas.

9. There have been many calls for ‘a level playing field’. Are we ever likely to get one?

It is obvious that a level playing field with equal objectives for competing industries worldwide is still far away. It is only enforceable if the major developed and emerging economies work closely together. It is clear that if the international climate negotiations in Paris in December 2015 do not come to results, that the EU must rethink its unilateral climate policy. The EU has only 10% of global GHG emissions, a percentage that is shrinking rapidly, mainly resulting from growth in emerging economies’ emissions.

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The EU should support its steel industry when unfair trade harms our position on the domestic EU as well as foreign markets, as effective as the USA. Unlike China, the EU steel industry operates under a strict code prohibiting state aid. China’s massive, subsidised excess capacities are depressing domestic prices and fuelling unprecedented steel export surges. We monitor closely the trade situation while developing our communication with the Commission on the worsening Chinese steel situation.

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11. Are you happy about the EU’s decision to pursue a CO2 emission reduction target of 43% by 2030 and does the steel industry have the technology to achieve it?

The new framework is an extremely challenging target for Europe’s industry in the absence of similar constraints for our competitors worldwide. But the clear commitment by the heads of state to set safeguard measures at the level of the most efficient installations is a positive signal for industrial investment, growth and jobs in Europe. A profitable European steel industry benefits European society as a whole. It will be able to continue contributing to significant emission reductions in Europe.

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12. You say that the EU’s commitment to set safeguard measures at the level of the most efficient installations is a positive signal and that the new framework on the table is ‘extremely challenging’. How do you think steelmakers will react?

It is now time for the European Commission to rapidly implement the safeguard measures and provide sectors at risk of carbon leakage with truly 100% free allocation at the level of the 10% most efficient installations, based on technically and economically achievable benchmarks, and on real production instead of historic production levels. CO2 costs passed-through in electricity prices must be fully offset in all member states. Those installations above the benchmark will have to buy additional allowances on the market. This gives them the right incentive to improve their carbon efficiency to the level of the benchmarks. t

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COATINGS

Simulation studies in Hot Dip Process Simulator (HDPS) on Al-Si Coatings Efforts have been made to develop Al-Si based coatings using a hot dip process simulator (HDPS), to avoid oxidation/surface decarburisation of Mn-B steel during hot stamping. By S.K. Shukla*, M. Deepa*, Anjana Deva*, Santosh Kumar*, Atul Saxena* and B.K. Jha* THE hot stamping process combines hot forming and subsequent quench hardening in a single process step. The process is compatible with the chemical composition of boron-alloyed steels, because it creates a robust process window for quenching, which causes martensitic transformation.

When uncoated boron steel is transferred from the furnace to the press, an irregular and abrasive iron oxide layer forms on the blankâ&#x20AC;&#x2122;s surface. Because of direct contact with atmospheric oxygen, oxidation occurs and results in superficial decarburisation, which is detrimental to a partâ&#x20AC;&#x2122;s final properties. In order to avoid scaling during hot stamping, different types of coatings have been developed worldwide. In the present work, efforts have been made to develop Al-Si based coatings, using a hot dip process simulator (HDPS), to avoid oxidation/surface decarburisation of Mn-B steel during hot stamping. Experiments were conducted using a HDPS to ascertain the optimal aluminised bath composition and other coating parameters (bath temperature, dipping time and so on) to achieve superior properties in Al-Si coatings in terms of corrosion resistance and adherence as well as crack and voidfree coating during hot stamping. It has been found that Al-13%Si-1%Na is the optimum bath composition to achieve superior properties in Al-Si coated Mn-B steel sheets in terms of corrosion resistance, formability and coating adherence.

Introduction In the automotive industry, to improve vehicle safety and reduce fuel consumption, manufacturing of light weight body parts from manganese boron steel (22MnB5) is rapidly increasing. The forming of ultra high strength steel at room temperature is limited by low formability and considerable spring back. Hot stamping, therefore, is accepted as a widely used and viable alternative solution. It is a non-isothermal

Fig 1 General view of HDPS at RDCIS

forming process for sheet metal where forming and quenching take place in the same forming step1. This process takes advantage of the low flow stress of boronalloyed steel in the austenitic phase at elevated temperature and allows parts to be manufactured with ultra high strength, minimum spring back and reduced sheet thickness.

The hot stamping process significantly extends the possibilities for parts production. There are currently two common hot stamping methods: direct Element C Mn

Wt (%) 0.23 1.26

Si

0.28

S

0.008

P

0.015

Cr

0.16

B

0.003

Ti

0.023

Al

0.044

Table 1 Chemical composition of Mn-B Steel substrate used in simulation studies

and indirect. The two-stage indirect hot stamping process allows the production of more complex shaped parts, but is more complex and more cost-intensive due to upstream cold stamping and subsequent hot stamping stages. However, the onestage direct hot stamping method is the most frequently used and is ideal for processing manganese boron steels with a hot dip aluminising coating. The coating protects against scaling, which is a typical feature of the hot forming process, and thus increases the lifetime of the forming dies. During heating, the protective coating is transformed into an alloyed layer of Fe-Al-Si that is highly adherent to the substrate and has good corrosion properties2. However, degradation of the Al-Si coating in terms of intermetallic phase formation, Kirkendall voids and crack formation occur at high temperature. In view of the above, efforts are required to develop new types of AlSi coatings for hot stamping operations, which are free from the above-mentioned

*R & D Centre for Iron & Steel (RDCIS), Steel Authority of India Limited (SAIL), Ranchi -834002, Jharkhand, India Email : skshukla@sail-rdcis.com www.steeltimesint.com

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COATINGS

12

14

11

10 Erichsen cup value

Corrosion rate, mpy

12

8 6 4

10

9

2 0

8 Al-6%Si

Al-10%Si

Al-13%Si

Conventional GI sheet

Fig 2 Corrosion resistance of Al-Si coated vis-à-vis conventional galvanised sheet

degradation. In view of the above, the objective of the current work is to optimise aluminised bath composition (Si level and other alloying elements) and coating parameters (bath temperature, dipping time) to achieve superior properties in Al-Si coatings with regard to corrosion resistance and adherence as well as to ensure crack and void-free coating during hot stamping.

Experimental Experiments have been conducted in HDPS (Fig 1) on Mn-B steel substrate (chemical composition shown in Table I), by varying the aluminised bath Si level (6-13%), annealing temperature (700-750°C), time (60-90 seconds) and bath temperature (590-610°C). However, other parameters, like dipping time (~3 sec.), dew point of the annealing atmosphere (-20°C), Na level in aluminised bath (~1.0%), nozzle distance (17 mm) and wiping gas flow rate (200 lpm) were kept constant during the experimentation.

In each simulation test, Mn-B steel sheets sized 200mm (L) x 120mm (W) were heated at the rate of 30°C/s to the annealing temperature and soaked at for 60-90 seconds in an annealing atmosphere of 20%H2+80%N2. The dew point of the annealing atmosphere was kept at ~ -20°C during experimentation. Subsequent to annealing, samples were cooled with N2 gas up to near bath temperature (5°C more than the bath temperature) at a rate of ~4°C/s and subsequent to dipping in a zinc bath, the samples were cooled down to room temperature at the rate of 10°C/s.

Al-Si coated Mn-B steel samples are characterised by coating thickness, corrosion resistance, formability, adherence and microstructures. The coating thickness (CT) of the galvanised samples was measured using a Defalsko Coating Thickness Gauge (Positector 6000). Formability characteristics of GI sheets were evaluated using an Erichsen Cup Tester and during the test, the point November/December 2014

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Al-6%Si

Al-10%Si

Al-13%Si

Conventional GI sheet

Fig 3 Formability of Al-Si coated vis-à-vis conventional galvanised sheet

at which the cracks/peel-off of the coating begins is when punch movement is taken as the Erichsen Cup value of the composite.

Coating adherence of coated sheets was assessed through a lock forming tester.

The corrosion rate of the coated sheets was measured by the Taffel plot equation using a Potentiostat under the following conditions: Test Solution: 3.5% NaCl Reference Electrode: Silver – Silver chloride.

Scan Rate: 0.1 mv/s.

Scan Range: ± 20 mv.

Metallographic analysis of simulated aluminised sheet samples was carried out using a Scanning Electron Microscope and an EDAX (Energy Dispersive X-ray Analysis) system. Al-Si coated Mn-B steel samples were subjected to a heat treatment cycle (heating @ 8-10oC/s up to 930oC, soaking at 930oC for five minutes followed by cooling at 40oC/s), as per hot stamping operation. Metallographic analysis of the heat-treated Al-Si coating was conducted to examine degradation in the coating.

Results & discussion Effect of annealing parameters on Al-Si coating quality Coating experiments on Mn-B steel substrates were started with an Al-13%Si1%Na bath composition. Initially, the annealing cycle during coating experiments was maintained as followed during conventional galvanising/aluminising experiments. Steel samples were heated at 30°C/s up to an annealing temperature of 700oC and soaked at this temperature for 45 seconds in an annealing atmosphere of 20%H2+80%N2. The dew point of the annealing atmosphere was maintained at -20°C. Samples were subsequently cooled up to ~600°C (10°C more than the bath temperature: 590°C in this case) and then dipped in the bath. On examining the coated samples, it was found that they were not uniformly coated and that Al-

Si coating had only taken place in a few spots. In subsequent experiments, the annealing temperature was increased to 750°C and the soaking time was varied between 60 and 90 seconds, while other parameters were kept constant. It was observed that a higher soaking time (90 seconds) at an annealing temperature of 750°C resulted in an improved coating quality, as higher soaking time allows better reduction of oxides present on the steel surface, thereby resulting in good coating quality. Subsequently, in all the experiments (with different Al-Si bath compositions), the annealing temperature at 750°C and the 90-second soaking time was maintained.

Properties of Al-Si coated Mn-B steel sheets Al-Si coated Mn-B steel samples were characterised in terms of corrosion rate, formability properties, coating adherence and microstructures. Corrosion resistance was measured through an electropolarisation test using the Taffel plot, varied in the range of 1.4 to 12.4 mpy, depending on the processing conditions.

For Al-Si coated sheets, aluminised in Al-6%Si bath, the corrosion rate varied from 6.4 to 12.4 mpy, while the corrosion rates of coated sheets aluminised in an Al-10%Si and Al-13%Si bath were in the range of 3.3 to 4.4 and 1.4 to 4.1 mpy respectively. In Fig 2 corrosion rates of Al-Si coated sheets vis-à-vis conventional galvanised sheets has been shown.

The corrosion rate of Al-Si coated sheets is superior to galvanised sheet because Al offers higher oxidation and corrosion resistance because of the formation of a tenacious and protective oxide film, Al2O3, at the sheet surface. Furthermore, with an increase in Si content in aluminised bath from 6% to 13%, the corrosion rate of Al-Si coating improves significantly from 9.4 mpy to 2.75 mpy. An increase in Si content in Al melt results in the formation of Fe-Al-Si phases in the coating structure www.steeltimesint.com

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COATINGS

which inhibits cathodic reaction, thereby resulting in superior corrosion resistance of the Al-Si coating with a higher silicon level (~13%).

The formability characteristics of the newly developed coated sheets were quantified in terms of the Erichsen Cup Value of the composite. In simulated aluminised sheets, it varied between 9.0 mm to 11.8mm depending on bath composition and the processing conditions of the sheet. Formability properties of AlSi coated sheets vis-à-vis galvanised sheets have been shown in Fig 3.

Generally, steel sheets aluminised in a 100% Al bath exhibit a limited formability, as formability is affected by the thickness of the interlayer (alloy layer formation).

For this reason, where formability is a requirement, the aluminising is preferably carried out in silicon-containing melt. The microstructure of Al-Si coating reveals that whereas with hot dip aluminising (HDA) in pure aluminium the interface exhibits a finger-like or dendritic profile, the HDA with Al-Si alloys yields a more ‘planar’ interface. Furthermore, the thickness of the compound layer in HDA with AlSi alloys is, in general, much smaller than that obtained in HDA with pure aluminium. Microstructures shown in Fig 4 to Fig 6 indicate that the thickness of the interlayer, as well as the profile of the interlayer/substrate interface, are both affected by the silicon content of the melt.

It was observed that the interface became almost completely ‘planar’ at a silicon level of about 13%. Further increases in the silicon level didn’t cause any appreciable change in thickness or profile. The addition of Si into the aluminising melt causes the finger like growth mode to gradually disappear.

This is believed to be due to an increase in interface energy, or a reduction in diffusion through the Fe2Al5 layer3. The best formability properties of Al-Si coated sheets, however, were observed for Al13%Si-1%Na bath. This may be because of the lower bath temperature that can be maintained at this silicon level (due to eutectic reaction) leading to less dross generation and a slower formation of FeAl-Si intermetallics at the steel-coating interface4. Also, transition of the growth morphology of eutectic Si from plate like Fig 4: Microstructure and EDAX analysis of Al-6%Si coated Mn-B steel sample Fig 5: Microstructure and EDAX analysis of Al-10%Si coated Mn-B steel sample Fig 6: Microstructure and EDAX analysis of Al-13%Si coated Mn-B steel sample Fig 7: Microstructure and EDAX analysis of Al-13%Si coated Mn-B steel heat treated (HR : 12oC/s) sample Fig 8: Microstructure and EDAX analysis of Al-13%Si coated Mn-B steel heat-treated (HR: 10oC/s) sample

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Fig 4

Fig 5

Fig 6

Fig 7

Fig 8

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COATINGS

to fibrous resulting from the effects of Na on the nucleation and growth of both Al and Si phase5. Coating adherence of the Al-Si coated sheets was also assessed using a lock forming tester.

Most of the sheets offered excellent coating adherence and no cracks were observed near the bend portion. However, in some cases, minor cracks were found, particularly on steel sheets aluminised in Al-6%Si bath.

Coating quality evaluation of heat treated Al-Si coated sheets Mn-B steel sheets which were aluminised in Al-13%Si-1%Na bath (coated sheets which manifested best properties), were subjected to a heat treating cycle, in HDPS, as followed during hot stamping.

The heating rate (HR) was varied in the range of 10°C/s to12°C/s. The heating was deliberately kept low to prevent the AlSi coating from melting (melting point is approximately 600°C). Microstructures of the heat-treated Al-Si coating have been shown in Fig 7 & 8.

It can be seen in Fig 7 (HR: 12°C/s) that some cracks and voids are present in the Al-Si due to a higher heating rate.

However, the coating has not melted

because the aluminium plating layer of the product transforms during heating, before press forming, into an Fe-Al alloy phase, which has a high melting point. In the case of Al-Si coating heated at 10°C/s, no cracks and voids were observed (Fig 8) and the Al-Si coating was found to be smoother and more uniform.

Acknowledgements The authors thank SAIL’s management for support and encouragement and thankfully acknowledge permission to publish this paper. Thanks also to the laboratory staff of RDCIS.

Conclusions •To achieve superior Al-Si coating quality on Mn-B steel substrates, the sheet must be annealed at 750oC for a minimum of 90 seconds in 80%N2+20%H2 atmosphere at a dew point of -20oC. •The Si level in aluminised bath significantly affects the corrosion resistance and formability properties of Al-Si coated Mn-B steel sheets. Al-13%Si1%Na bath composition results in the best possible combination of properties in terms of corrosion rate (1/3rd w.r.t conventional GI sheets), formability (at par with substrate) and coating adherence (as per lock forming quality standard).

• To avoid degradation of Al-Si coating during the hot stamping cycle, the heating rate must be maintained at less than 10oC to achieve crack- and void-free coating and prevent the coating from melting.

1 Masayoshi SUEHIRO, et.al, “Properties of Aluminium-coated Steels for Hot-forming”, NIPPON STEEL TECHNICAL REPORT No. 88 JULY 2003, pp 16-21 2 A. Naganathan, “Hot-Stamping of Manganese Boron steel”. MS Thesis submitted at Ohio State University, 2010 3 Lenze, F, J., Banik, J., Sikora, S.,”Applications of hot formed parts for body in white”, ThyssenKrupp Steel, Dortmund, Germany, International Deep Drawing Research Group Proceedings, Olofström, Sweden, June 2008 4 Wilsius, J.; Hein, P.; Kefferstein, R., ”Status and future trends of hot stamping of USIBOR 1500 P” Arcelor Research Automotive Applications, 1.

Erlangener Workshop Warmblechumformung 2006, Bamberg, Meisenbach 2006 5 Altan, T.; Yadav, A., “Hot Stamping Boronalloyed Steels for Automotive Parts – Part II” ERC/ NSM, Ohio State University, Stamping Journal, Jan. 2007

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Sculptured by the US artist Richard Serra, 4m wide plate, 50mm thick, has been curved and stood on edge to make eight massive mazes in the ArcelorMittal gallery

SPANISH STEEL

Bilbao once famed for steel and shipbuilding is now known for its Guggenheim Museum

Siderex – Exporting steel and services from Spain’s Basque region Prior to the 2008 recession, Spain’s equipment manufacturers had largely switched from domestic supply to exports. Where processing equipment is concerned, 80-90% of output is now exported and 10-20% destined for domestic sales, the reverse of the pre-2008 era. The main markets are no longer Europe but Asia, the Middle East, Turkey and Russia. By Tim Smith* THE Spanish Association of Steelworks Exporters (SIDEREX) is a non-profit organisation founded in 1996, with the main goal of promoting Spanish steel exports and defending the general interests of its members.

Siderex has 70 member companies, seven of which are steelmakers ranging from producers of carbon, stainless and alloy steels; 19 are steel processors and 44 are engineering and equipment manufacturers and suppliers of spare parts, components, raw materials and services to steel plants.

In 2012, the total turnover of Siderex members was €6.031bn with exports of €3.445bn.

Siderex and 50 of its members are headquartered in Bilbao in the Basque region of Spain. The organisation is financed by its members and supported

by the Spanish government’s Trade Department (ICEX).

The Basque region has a strong steel heritage following the discovery, in Roman times, of rich ores in the Bilbao district. In the 19th century, these ores were exported mainly to England and Germany. In the early 1900s, 87.5% of all the UK’s imports of ore came from Spain.

The rich ores of Bilbao led to the establishment of steelmaking in Spain and its supporting industries in the region of Bizkaia (Biscay), surrounding the town of Bilbao.

Bilbao is located some 10km inland from the coast on the estuary of the river Nervión with its port facilities nearer the coast at Sestao. Indeed, the former integrated mill, Altos Hornos de Bizkaia, which closed in 1995, was located at the port and has been replaced by a modern

Electric Arc Furnace (EAF) minimill making flat products via two CSP (Compact Strip Production) thin slab casters directly linked to a hot strip mill. The new works was initially called Aceria Compacta de Bizkaia, but now, as one of six mills in Spain owned by the ArcelorMittal Group, is called ArcelorMittal Sestao.

Today, Spain’s steel production is dominated by scrap-based electric steelmaking with 74.9% of the 13.7Mt of crude steel produced in 2013 made this way from 21 EAF plants. Only one integrated mill remains in the country, ArcelorMittal Asturias, located at Gijón some 260km west of Bilbao, and this produced 3.1Mt in 2013.

Half of the EAF plants are located in the Basque region, which has 11 EAF mills with a total capacity of 7.4Mt, but the steelmaking utilisation rate was only

* Consulting Editor Steel Times International November/December 2014

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SPANISH STEEL 52.7% with output from the region in 2013 at 3.9Mt – although this was up 3.9% on 2012. There is also a mothballed IMt/yr plant, Corrugados Azpeitia, at Azpeitia, some 70km east of Bilbao. Liquid steel from the Basque region made up 29% of Spain’s total output in 2013 and 36.8% of total EAF output.

While the extensive use of EAF steelmaking reduces the need to buy CO2 emission certificates (CO2 emissions from scrap-based steel production are below 500kgCO2/t crude steel – only about one-quarter of those from an integrated works) the price of electrical power in Spain is high and this has arisen because the Government paid out €50bn in incentives to renewable energy producers over the past 25 years, and could no longer sustain these payments.

As a consequence, not only have such incentives been cut to renewables, but also compensation previously paid to high energy users – those prepared to accept an interrupted power supply during peak demand periods – has also been removed.

This has increased power costs to EAF plants by 30%. In 2013, wind power became the largest source of power generated in Spain accounting for 21.1%.

Hydro at 14.6%, solar and geothermal at 6.9% and nuclear at 21.0% considerably reduce Spain’s carbon footprint in power generation (Fig 1).

Exports Since the start of the recession in 2008, Spanish manufacturing companies have striven to increase export business as the domestic market collapsed. Apparent steel use in the Basque region fell 13.2% between 2012 and 2013 to 3.3Mt. Today, many manufacturers are exporting 80% of production with just 20% going to the domestic market. This is the reverse of the situation pre-2008. In terms of value, 81.5% of Spain’s total exports are of manufactured goods.

The value of exports from steel producers and processors for the year to 31 October 2013 was €5.4M but this contrasts with over 30 times this value achieved by exporters of plant and equipment which reached €165M. This sector grew 70% as a result of demand from the Middle East, Turkey, and Asia (mainly China).

Regarding the balance of trade for steel products across the whole of Spain, imports of steel – mainly flat products – reached 7.6Mt in 2013, and exports were 9.7Mt. Imports were 3.26% lower than in 2012, while exports fell just 1.03%. In the Basque region, exports of steel reached 2.7Mt in 2013, down 2.24% on 2012, while imports were 1.55Mt, down 0.92% on 2012.

In 2012, 184 companies in the steel production, processing and equipment www.steeltimesint.com

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Basque Region The Basque region is an autonomous community in north-eastern Spain made up of three provinces, Álava, Biscay and Gipuzkoa. It has a short 15km border with France at its northeastern point and is a mountainous region with a population of 2.1 million – almost half of whom live in the Greater Bilbao area.

Economically, the region has the highest income in Spain with, in 2010, a GDP one third higher than the average for Spain and 40% greater than the European Union average.

Spain’s ‘Industrial Revolution’ started with the exploitation of ore reserves in the Bilbao region in the 19th century. Its industry was built on steel production and shipbuilding. Today, this has been largely replaced by ‘high tech’ industries such as aeronautics, machine tools and energy generation.

manufacturing sector were involved in exports. Siderex organised delegations, visited 23 countries and took part in 17 trade missions as well as four international steel conferences and three exhibitions.

They also organised a summit ‘Challenges of the Steel Industry’ to discuss topics related to global steel including logistics, scrap, environment, special steels and the steel-related plans of the European Commission.

As well as the steel production and processing industry, the Basque region is ideally located to supply domestic producers, in particular the automotive sector, which has manufacturing facilities in the north and east of Spain. Car production in 2013 grew to two million units and is expected to increase 10% in 2014 to 2.2 million. Ford made a €1.5bn investment at its plant in Valencia, on the east coast of central Spain, last year adding two new assembly lines and a paint shop. Other global producers, including Renault, GM, and Volkswagen, have also been investing since 2011 moving some production from Belgium and South Korea to Spain.

This provides a ready market for steel from component manufacturers.

Investment is also being made in infrastructure with a high speed rail network currently under construction

to link the three regions making up the Basque country. Known as ‘Basque Y’, this will link Bilbao with the region’s capital city, Vitoria (named Gasteiz in Basque) to the south and Donositia (San Sebastián) in the east. The line is expected to be operational in 2017. The standard gauge line (Spain’s domestic network is narrower than this) will also connect to Madrid and to the French high speed network via Irun.

Maximum speed will be 250km/h. The total length of the line will be 135km of double track and 37km of single. Because of the mountainous terrain, 80 tunnels and 71 bridges are being constructed.

Part of the network will be owned by the Basque regional government and part by the Spanish national railway. The cost of the project when launched in April 2006 was €4.1bn of which the European Commission for Transport paid €118.5M and the European Investment Bank (EIB) loaned €500M to be repaid over 30 years.

The remainder is being financed by the Railway Infrastructure Authority of Spain.

Companies visited At the invitation of Siderex a delegation of steel trade-press members were given a three-day tour of the region visiting a total of seven member companies ranging from re-rollers, service centres, equipment and automation suppliers and a research and innovation centre.

Tata Steel Layde Tata Steel Layde is both a flat products service centre and a cold strip roller.

Established in Durango, 34km SE of Bilbao in 1941, the company specialises in cold rolling strip up to 650mm wide, mainly for the automotive market. It has an annual rolling capacity of 130kt.

Hot rolled coil delivered to the site for cold rolling is first pickled and slit to a maximum width of 650mm. It is then cold rolled in one of two reversing Innse Sendzimir mills to achieve high reductions.

Annealing is by batch process in Ebner HICON bell annealers using a hydrogen atmosphere. Finally it is rolled on one of two skin-pass mills to ensure flatness and the required ‘temper’ hardness.

Power

Installed

Av Supply

Supply at

Generation

Capacity

In 2013

at Peak Demand*

Wind

22.2

21.1

21.9

Nuclear

7.7

21.0

17.7

Coal

10.9

14.6

20.0

Hydro

19.4

14.4

17.3 11.8

Cogen & other

7.5

12.4

Combined cycle

24.8

9.6

9.3

Photovoltaic

4.3

3.1

0.2

Renewable thermal

1.0

2.0

1.7

Solar thermoelectric

2.2

1.8

0.1

*Peak demand 39.963MW on 27/2/13 at 20-00 to 21-00h Source: The Spanish Electricity System preliminary report 2013 Red Eléctrica de España http://www.ree.es/en

Fig 1 Power generation mix in Spain in 2013 (%)

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SPANISH STEEL

Strip can be rolled as thin as 0.1mm but for commercial reasons, 0.2mm is the normal limit. The maximum thickness is 0.4mm cold rolled and the slit width 10650mm. Each mill has a capacity to roll up to 65kt/yr and at present about 50kt/yr is rolled on each. Grades rolled are generally low-to-high carbon, spring steels, free machining Mn-Pb and low alloy Cr-V. Recently boron-containing steels have been processed, and also trials to roll 1%C steels are underway, but ultra-highstrength duplex steels are not rolled.

Traceability is an important part of the supply and as well as mechanically testing samples prior to dispatch, additional samples are cut and stored for up to five years should subsequent investigation be required.

Tata Steel Layde also supplies hot band, slit coil and cut to length as part of its service centre portfolio. It can slit material up to 8mm thick and pickle up to 7mm.

Most of the coil is sourced from Tata Steel Europe, although, as a service centre, some coil comes from other suppliers. The maximum coil weight is 28t which is the limit imposed for transportation by road in Spain.

The company is the only one in the Tata Europe group now rolling thin strip, and is the only Tata distribution centre in Spain.

Europe accounts for 62% of the company’s sales. Spain is the main market but Italy and the Czech Republic are also important.

Automotive applications account for 62% of output, followed by construction (20%) and general engineering (18%). Demand grew by 18kt in 2013.

A workforce of 142 operates the site, on a three-shift basis in some ‘bottleneck’ areas such as the pickle line, but generally operate two shifts. www.layde.es

This privately owned group employing around 600 is one of the largest groups for design and manufacture of roll forming and coil processing equipment, with manufacturing facilities in Australia, Canada, China, Spain, New Zealand and the United States. While the vast majority of Athader’s production is cut-to-length and slitting lines, it also builds lines for blanking, trapezoid cutting, grinding and brushing and recoiling. The company employs 20 workers and expects to increase this number as markets return.

It also out-sources production of some components.

Full automation is provided using recognised components supplied by such companies as Siemens, Allen-Bradley, Baumer and others. As far as possible, structural steels and components are sourced locally. It can supply lines capable of handling coil weights of up to 45t and thicknesses up to 25mm. Coils of coated steel, stainless steels and aluminium can all be processed.

80% of its production is exported. It has 25% of Spain’s export market for cutting and slitting lines and about 5% of the world market. The traditional markets of Europe and Latin America are now being replaced with orders from the Gulf, Asia (it has decided not to supply to China), USA, Russia and a growing interest from Turkey. www.athader.com

Athader SL Located in Tolosa, 117km east of Bilbao, Athader designs and builds coil processing lines, in particular cut-to-length and slitting lines, with integrated roller levellers and stacking equipment as options.

Founded in 1992, the company joined the US-based Bradbury Group in 2012.

Tecnalia Tecnalia is a privately-owned research and innovation centre headquartered in Spain where it has 17 facilities including at San Sebastian, Bilbao and Vitoria. It has four locations outside of Spain, one each in France, Italy, Serbia and Mexico. Tecnalia was established as a non-profit making

Refurbishment has become a growing market for Jaure from Europe’s steelmakers

Athader sources local steel and components for its coil processing lines

organisation in 2010 by the merger of eight specialist R&D groups, the earliest established in 1955.

Its mission is ‘to transform knowledge into GDP’, by acting as a bridge between universities and industry. Its workforce of 1,415 is made up of around 30 nationalities includes 200 with doctorate post-graduate degrees. It presently holds 303 patents.

To date it has served 4,000 clients.

51% of its €122M revenue last year came from contracted work, 34% from competitive public funding and 15% from non-competitive public funding.

It also participates in the EU Framework programmes.

It has seven divisions covering construction, energy, software, health, technology services, innovation strategies and industry and transport. This last division includes the steel industry.

Activities in the steel industry include software modelling, robotics, casting, joining materials – such as composites – to steel for light-weighting of vehicles, testing and analysis, metallography, and, presently under investigation, the recovery of zinc from steelmaking dust by means of a plasma furnace. www.tecnalia.com Jaure SA Jaure, located at Zizurkil, 110km east of Bilbao, builds transmission systems for the metals and heavy industries. Established in 1958, in 2005 it became 100% owned by the US-based Emerson Industrial Automation group where it sits within the Mechanical Power Transmission segment.

Jaure supplies drives and couplings to a range of industries, including paper, marine, mining, hoists and wind power.

Metal processing is the largest segment accounting for 35% of the business.

It supplies couplings for rolling mills, continuous casters and process lines. In addition to its works in Zizurkil it has a manufacturing plant in Slovakia.

It employs a workforce of around 100 and can make use of the 300,000-strong Emerson Industrial group to promote global sales, servicing and design. For example, FEM analysis is conducted at Emersons’ design centre in Puna, India.

Marine drives account for 25-35% of business and wind power 15-20%, the www.steeltimesint.com

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A special rotating lift order for Jaso

latter growing strongly in Asia. In this sector, the use of carbon fibre composite shafts is growing.

Materials and components, such as bearings, are sourced locally wherever possible or from other Emerson Industrial companies. Steel is not purchased from China.

75-80% of exported transmissions go to Europe, but Asia is a growing market.

Turnover is increasing and business in Spain reached €24M in 2013 and is expected to be €26M this FY to 30 September, but has not yet reached the level of 2008. There is also a growing demand for refurbishment of drives. www.jaure.com Talleres Jaso Industrial SA Jaso, a group member of Talleres Jaso, located in Itsasondo 90km east of Bilbao, manufactures lifting equipment, mainly gantry cranes. Established in 1965, it designs and builds cranes, specialising in the harsh environment experienced in the steel sector. To date, it has supplied over 50,000 units to companies in more than 50 countries. It is the market leader in the Spanish market with 95% of Spain’s industrial crane market and has important markets in Europe, Mexico, Argentina, India and Brazil.

Group turnover in 2013 was €120M of which Jaso Industrial accounted for €70M. It has the capacity to produce 1,300 cranes a year, 1,200 of standard design and 100 specials. The steel industry accounts for 65% of sales – for example ArcelorMittal has 330 Jaso cranes worldwide and Gerdau 223. Prior to the 2008 recession, 70% of orders were domestic and 30% exports. Since then, domestic orders fell 40% and 78% of production is for export, including to Saudi Arabia, Argentina, Brazil and Russia. Most of the work within Spain is for revamps. The Turkish market is difficult to enter as they have around 75 domestic crane builders.

The largest crane it has built has a lifting capacity of 360t and was supplied to a power plant for Iberdrola. The largest melt shop crane built by Jaso Industrial has a capacity of 220t, but in fact was a heavier construction than the Iberdrola crane because of the harsh and hot environment of the melt shop. For such cranes, all electronics are fitted inside the www.steeltimesint.com

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box girders, which are protected with insulation panels on the outside.

The life of a standard crane may be just 10 years, but with good maintenance could be twice this.

The company carries out refurbishment of cranes. Upgrades to take a greater weight are also carried out by the company. For example, a load upgrade to lift an additional 50t was achieved by extending the base of the crane and adding more wheels so as to ensure axle weights did not exceed the load bearing specification of the building.

Customers today generally require faster operation. This can be achieved by building lighter cranes but through design changes rather than the use of thinner sections of high strength steels.

Transfer cars are included in the company’s portfolio, but account for only about 5% of sales.

Company turnover for 2014 is expected to reach €50M, up 20% on 2013 but below the €70M achieved in 2007. www.gruasjaso.com Ingeteam Power Technology Ingeteam, with its works at Zamudio, just 12km east of Bilbao, produces a complete range of electrical equipment and automation for process monitoring and control. The company was formed as a result of the 1980s merger of TEAM and Ingelectric. Team specialised in electrical transmission while Ingelectric concentrated on power supply for the steel industry. In the 1990s, Ingeteam specialised in the design and manufacture of industrial PLCs for the steel industry as well as energy distribution and control.

In 2000, it purchased Inder, a company established in 1940 to make electric motors and generators. In recent years, it has entered the wind turbine market which, until 2007/8 was very profitable. At this time it held 13% of the wind turbine business. The steel business has dropped to around 10% of turnover.

As well as serving the steel sector, the company also produces Energy Management Systems (EMS), electrical energy storage units using batteries or the grid, thermal storage units for solarheated panels – which employ the Rankine cycle in which a fluid in a closed circuit is heated at one end to cause it to flow

37

through a turbine. It also has a marine propulsion section to supply shipping, a traction section to supply conventional trains, and a section to supply mines.

To recover energy, systems such as trains and reversing mills use regenerative breaking enabling the motor to feed power back into the supply grid. It also promotes the use of variable speed drives for items such as fume extractor fans and cooling water pumps so that power demand is reduced when these units are not required to work. www.ingeteam.com Glual Hidraulica SL Located in Azpeitia, 72km to the east of Bilbao, Glual builds and automates hydraulic systems to supply a range of industries. The steel market accounts for about 20% of sales. 90% of its business is outside of Spain, in contrast to pre-2008 when 80% of its sales were domestic. As a component supplier, the final destination of its products is not always known, for example, exports to Germany are high but their systems are incorporated into plants that may well be destined for China.

The company manufactures a wide range of actuators, for example for mill guides, lifting tables, walking beam furnaces, continuous casters and cooling beds. It also supplies cylinders for automatic gauge control (AGC) of the mill gap, although does not provide the feedback control for this. It buys in pumps, and where required, hydraulic motors.

The company also builds testing benches for hydraulic systems and supplies these to key industries such as aerospace.

Glual offers its customers a short supply time if they want purpose-built equipment within eight weeks.

The company also has manufacturing facilities in Bulgaria, China, USA and Brazil.

Glual is privately owned and employs 350 worldwide, with 120 employees in Spain. While manufacturing by Glual may move out of Spain, R&D and design will remain in Azpeitia where a team of 20 use 3D software to design systems.

Surprisingly, material selection is dictated by the customer rather than proposed by the design team.

The visit to Glual was followed by a visit to Rugui in nearby Azkoitia, a small re-roller producing hot rolled narrow strip and bar, to see some of Glual’s hydraulics in action. t www.glual.com Siderex, Ledesma 10 bis, 1˚ izq, 48001 Bilbao, Spain Tel +34 944 706 504 e-mail siderex@siderex.es www.siderex.es November/December 2014

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CONFERENCE REPORT

The growing importance of DRI The 2nd DRI and Minimill Conference, organised by Metal Bulletin and American Metal Market, took place in New Orleans in September. Hans Mueller* reports

DURING September 10-12, 2014, the US port city of New Orleans hosted a conference on steel-making materials, jointly organised by Metal Bulletin and American Metal Market. The first term in its title, DRI, refers to iron-ore pellets or lumps from which oxygen has been removed by means of energy-rich gases, mostly natural gas (NG). Much of the DRI is used as feedstock in electric arc furnaces (EAFs), which in the USA accounted for 61% of the 87 million metric tonnes (MT) produced last year. EAF furnaces used to be operated primarily by small steel companies, dubbed minimills, several decades ago. Although some have meanwhile become very large, the term is still applied today.

DRI is of special interest in parts of North America, where new drilling methods have led to increased extraction and a sharp drop in the price of NG, a major cost element in the production of DRI. Unlike on previous occasions, this time such enormous quantities of NG have been spotted that low prices are expected to hold far into the future. The outlook is, therefore, excellent for more investment in DRI production at locations favoured by low-cost shipments of iron ore to the plant and of DRI to minimill customers.

However, the title given to this conference was overly restrictive. As was pointed out by several speakers, DRI is also used by several integrated steel makers in their smelting and refining processes. These mills often prefer to have the material delivered in a compacted form called ‘hotbriquetted iron (HBI)’.

The economic outlook for North American steel The market for DRI depends on steel demand, which in turn is linked to the fortunes of manufacturing and such sectors as infrastructure and housing construction. Two executives and an economist addressed these topics. S Sanyal of ArcelorMittal talked about impediments

to growth, including a growing shortage of skilled workers, trade distortions, and global overcapacity (‘state-sponsored’ in the case of China).

He suggested such solutions as rehiring retired workers, multi-tasking the workforce, establishing more training centres and, with respect to foreign competitors, removal of trade restrictions, ending all ‘state ownership’ in production

promoting growth included the current easy-money policy, stable oil prices, a recovering housing market, rising business confidence, cheap energy, low unit labour costs and a general firming of demand. Negative factors were high structural unemployment, weak consumer confidence, high debt levels, high corporate taxes, the threat of inflation and uncertainty surrounding domestic policies

and generally making all economies market-based. Steel companies should pursue vertical integration, practice more risk management, and enter widely into partnerships and long-term contracts. R Oppelt of Accenture likewise expressed concern that expansion of the US steel industry might be hampered by a lack of skilled labour and suggested continuous training arrangements, focusing especially on the use of mobile devices for communicating large data files. D North of Euler Hermes Insurance commented that lower NG prices in the USA should improve the international competitiveness of American industries. His list of factors

and geopolitical events.

Metallics, shale gas, iron ore and merchant DRI Panel members tossed about numerous ideas and suggestions concerning metallics. There were warnings that the falling price of iron ore was approaching the production costs of 80% of global mining companies, that the cost of collecting and shipping scrap was rising while prices were very low, and that it had become harder to find low-grade scrap in US markets. All agreed that adding HBI to the burden ramps up blast-furnace (BF) production volume while it reduces

* Global correspondent www.steeltimesint.com

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CONFERENCE REPORT

CO2 generation. R Hunter of Midrex and R Bellisle of ArcelorMittal noted that the often-heard designation of DRI as a “scrap substitute” does not apply to very lowgrade scrap, a material that is rejected by most EAF operators. Only the addition of DRI, with its diluting effect on harmful trace elements, turns such material into acceptable EAF feedstock. Acting as a complement to scrap, DRI would boost rather than diminish its usage. But DRI is no doubt a substitute of pig iron.

Shale gas production is largest in the American northeast, the mid-continent and Texas, whereas consumption is rising fastest in the southeast, Nicole Leonard of Bentek Energy pointed out.

Considerable investment in long-distance pipelines will, therefore, be required. In the meantime, rail transport will have to do. Due to looming surpluses, several ports along the gulf are being equipped with export facilities. Ms. Leonard added that profit-maximising oil companies were putting more emphasis on drilling for oil rather than gas, but that gas was often a byproduct of oil extraction. According to S Kaplan of the Energy Information Administration, the USA now produces more oil than Saudi Arabia, exports NG by pipeline to Mexico and Canada, and has become a major exporter of petroleum products. Moreover, greater efficiency in the use of energy had caused past forecasts to overstate demand by a significant margin.

Iron ore, accounting for about half the cost of producing DRI, was the topic tackled by two mining company executives, F Blanco¹ of Vale and R Chaigneau of Rio Tinto. Both talked at length about their companies’ mining activities, their contributions to the development of DRI pellets, and their very ambitious expansion plans². One can only wonder what strategy these companies intend to pursue by greatly expanding output capacity at a time when the world market suffers an iron-ore glut and prices have greatly weakened. It might well be Category Iron ore consumption Natural gas consumption Electrical power Labour Maintenance w/o catalyst replacement Maintenance with catalyst replacement included Industrial gases (O2/N2)

Weight 84% 10% 2% 2%

2%

-

0.2%

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Difference MIDREX ENERGIRON ZR

Nucor Steel DRP. First vessel of Samarco iron ore delivery. Located in Louisiana by the Mississippi river, iron ore pellets are received via ocean going vessel.

that they want prices to remain low for some period in order to drive new and still fairly high-cost competitors from the market.

Merchant DRI is not widely available in the US market, Lynn Lupori of Hatch told the audience. It seems that imports from Venezuela and, more recently, Russia, were of the merchant type. However, the majority of reported imports were destined for Nucor and ArcelorMittal mills. Ms. Lupori explained that operating a DRI plant in the USA would be handicapped by the absence of domestic DRI-grade pellet production and by a fragmented customer base. She also presented a rather heroic forecast of NG prices until the year 2040.

DRI technology and the EAF and BF/BOF processes As far back as 1957 the Mexican Hylsa company built the world’s first DRI plant, calling its process HYL. Ten years later the US Midland Ross company built a DRI plant on the US west coast, using its own Midrex process. Then, in partnership with German minimill pioneer Willy Korf, the company started building DRI plants on the US east coast (Georgetown, no longer in operation) and in Germany (Hamburg, still operating). Midrex has meanwhile Comments Same Same

overtaken HYL in the construction of new plants. By 2013 Midrex accounted for 63% of the 70MT of DRI produced worldwide, compared with HYL’s 15% share. However, a new firm, Energiron, created in 1995 by the absorption of HYL into dynamic equipment maker Tenova, which was joined in 2006 by steel-plant maker Danieli, has been trying hard to change this ratio³. Since 1998 the firm has scored several successes, most recently the construction of the world’s largest DRI plant (2.25MT/yr capacity) for American steel maker Nucor. Delegates were given a chance to visit this plant on the day following the meeting.

At the technology session H Gaines represented Midrex, I Martynov was there for Danieli and was backed by A Manenti of Tenova, who spoke for Energiron. Ian Cameron of Hatch, meanwhile, made a side-by-side comparison of the two systems. Gaines emphasised that the cost of energy-efficient hot DRI was below that of pig iron and he described how plants can be retrofitted to produce this specific product. DRI had far lower residual levels (Sn,Ni,Cr,Mo,S,P, Si) than most types of scrap, enabling EAF operators to venture into more advanced steel product lines.

Moreover, Midrex had built several large plants in India that use gasified coal, Corex Monterey downgrade will lower this to 45

Shale gas Rank

Shale oil Country

Trillion cubic feet

Rank

Country

1

China

1,115

1

Russia

Billion barrels 75

2

Argentina

802

2

United States

58

3

Algeria

707

3

China

32

Advantage

4

United States

665

4

Argentina

27

ENERGIRON ZR

5

Canada

573

5

Libya

26

Same

6

Mexico

545

6

Australia

18

7

Australia

437

7

Venezuela

13

Advantage to

8

South Africa

390

8

Mexico

13

MIDREX

9

Russia

285

9

Pakistan

9

10

Brazil

245

10

Canada

9

World total

7,299

World total

345

Advantage to ENERGIRON ZR Advantage to MIDREX

Source: United States: EIA and USGS; other basins: ARI Note: ARI estimates US. Shale gas resources at 1,161 trillion cubic feet and US shale oil resources at 48 billion barrels

Top 10 countries with technically recoverable shale resources

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CONFERENCE REPORT

Fixed cost

Unit labour costs (ULC)

200

Fixed cost 5% Other variable cost 0% Electricity 2%

Other variable cost

Canada

150

Germany

Natural gas 100

Korea Japan

Yield

U.S.

Electricity Iron ore 45%

Natural gas 27%

Italy

Taiwan

Iron 50 ore Yield 21% Cost elements in DRI (ArcelorMittal)

off-gas and coke-oven gas instead of NG. Martynov claimed superiority for “stateof-the-art” Energiron versus “the other technology,” specifically in such areas as low emission levels of CO2 and NO× as well as high carbon content, which helped improve EAF practice (less power, more steel) and transport safety for the product.

Manenti described the main features of a low-cost Energiron micro-module (200kt/ yr capacity) that has been operating in Abu Dhabi since 2010. Cameron expressed the view that both the Midrex and Energiron systems are competitive and reliable, offer proven hot-charging technologies and incur comparable operating costs. He did not evaluate capital costs. However, the Nucor plant’s capacity exceeds by 25% that of a Midrex HBI plant built in Texas for the Austrian Voestalpine (VA). Since both plants required an investment of $750M, it seems that Nucor did better with respect to “capital productivity”. S Sanyal of ArcelorMittal, a company that operates 8.4MT of Midrex and 2.3MT of HYL capacity, listed some of the disadvantages that come with the use of DRI in EAF furnaces, among them the need for more energy, higher refractory costs, lower yield and pyrophoric dangers when storing or transporting the material. Swedish steel expert R Gyllenham further elaborated the thesis of optimal EAF burdening, especially the extent to which the addition of DRI – as well as variations of silica within DRI – affect slag foaming, tap-to-tap time and energy use.

HBI utilisation by integrated steel mills, already mentioned in earlier sessions, was discussed in greater detail by a well-known raw materials consultant. J Poveromo explained that, by metallising the burden, HBI could significantly raise BF productivity, a result that may serve to stabilise a mill’s level of production when one of several BFs is down for relining. Alternatively, it could be done on a permanent basis to correct a mismatch between a plant’s hot metal (HM) capability and that of its rolling www.steeltimesint.com

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2002

2004

2006

2008

2010

2012 (f)

2013 (f)

US manufacturing is very competitive; low wage growth plus high productivity = low ULC Hatch

and finishing facilities. At times when scrap is very expensive, HBI may also be employed in basic-oxygen furnaces (BOFs) as a coolant. These are the applications that VA plans for part of the output of its 1.8MT/yr Midrex plant under construction in Texas. Poveromo cautioned that in order to maintain sufficient gas flow for preheating incoming raw materials, the use of HBI in BFs should be limited to 25% of the burden. In BOFs the addition of HBI should not exceed 100kg/T of HM. Logistics and shipping Capt. P Eagles of SMT Shipping left no doubt about the stringent enforcement of rules for shipping DRI on waterways and the high seas. The holds of ships must be thoroughly cleaned with the right chemicals, hatches must be watertight and, on long trips, they must be sealed with tape to hold in place a firesuppressing nitrogen blanket. The rules must be enforced even when shipping DRI qualities that do not become combustible in humid conditions. J Jaywant of ICAP Shipping USA commented that an agreement among many of the world’s shipping companies to show concern for the environment and cut the average speed of vessels to 20 knots reduced global dry-bulk shipping capacity by 14%

last year. Expansion of the dry fleet was very rapid from 2009-2012, then slowed down. El Niño occurrences severely disrupt much of the world’s dry-bulk trade.

Nucor’s DRI plant Located about 90km northwest of New Orleans, the plant has a deep-water harbour and excellent rail and road connections. Its high reactor tower is visible from far away. Still ramping up its level of output, it currently has a payroll of 140. Conference delegates were shown the control centre (housed in a rather spartan building), the elevated conveyer belt, which is designed to carry iron ore pellets one way and DRI pellets the other, and very capable harbour installations.

The conveyer ends over a floating-dock platform, which has DRI-loading facilities for barges on one side and unloading facilities for ocean-going ore carriers on the other. When the plant works at full capacity, these impressive installations will have to move in excess of 5MT of materials per year. t Notes:

1 Mr. Blanco uses the same notation “Mt” for information based on World Steel Association data, which is stated in metric tons, and data given in short tons furnished by the Midrex company.

2 Moderator Sara Hornby, of Global Strategic Solutions, injected the idea that integrated US mills could use their idle BF capacity to supply minimills with pig iron, thus displacing imports. It is not a fresh idea, having been discussed in February 2000 by Jay Agarwal of Charles River Associates at a Scrap and Scrap Substitutes conference. See Steel Times International, May 2000, p32.

3 On April 3, 2014, Tenova and Danieli entered into a strategic alliance with Nippon Steel & Sumikin Engineering to combine research and give Energiron access to the technology of high efficiency coal gasification and the utilisation of by-product gases from integrated steelworks.

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PERSPECTIVES: COMBILIFT

‘Steel cannot be beaten’ Combilift plans to purchase 15,000 tonnes of steel this year to construct its vehicles and believes that steel will always have a place in automotive manufacturing. The only way to get strength into a compact vehicle is by the using steel, says Martin McVicar, the company’s managing director

officer Ray Kilmer speaking about aluminium usage within the global automotive industry. Where do you stand on the aluminium versus steel argument?

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

Yes. Business is very positive at Combilift.

2014 will be by far the best year since we established the company 16 years ago.

Our turnover of approximately €145m will be 50% above our peak in 2008 before the global downturn. The majority of our growth over the last six years has come from within the steel sector. Our new larger sized products such as the straddle carrier (Combi-SC) have been very well received within the steel industry. A major reason for the success of the Combi-SC is that it allows many of our customers to handle full trailer loads of steel in their yard in one single lift.

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

It is great to see that global steel production has increased in the region of 2.5% over the last 12 months. However, as we sell our products into many markets worldwide we have noticed a decline in steel production within some of the South American markets. We note that many of the steel companies we supply into are operating much more competitive/ profitable businesses than was previously the case.

3. In which sector of the steel industry does COMBILIFT mostly conduct its business?

You can see Combilift multi-directional forklifts operating in various areas of the steel sector – starting from steel manufacturing right down to handling fully painted welded steel assemblies.

Since most steels are heavy in weight and long in length, Combilift’s range of fourway products offers major advantages in terms of space saving storage and safer handling compared to other types of forklifts (sideloaders and two-directional counterbalance trucks for example). If I had to pick an area that constitutes most of our business it would be with steel stockholders. Our products enable quicker and improved product location for these customers.

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I need to be careful what I say about aluminium since we have also many Combilift users in the aluminium sector!

Aluminium may be good when aiming for lighter, faster cars etc., but when it comes to manufacturing solid workhorses such as our trucks then steel will always have a place. We require counterweight and strength in small restricted design areas.

Steel cannot be beaten. We will purchase more than 15,000 tonnes of steel for production this year.

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

We have been very fortunate in that all of our markets have been growing but to answer your question it does seem that our largest growth this year is coming from the developed markets such as the USA and Europe. Even if these developed markets are importing steel there is increased demand for stock holders to carry larger quantities of steel and more grades in stock. The space-saving attributes of Combilift’s products allow our customers to cope with growing volumes and, therefore, to expand their stock without the need to relocate to larger premises.

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

Of the 75 markets we supply into, steel is our largest single market sector. We will deliver upwards of 1,000 Combilift units into the sector this year. We are closing business in the steel industry on a daily business, therefore, none mentioned none forgotten.

6. “Aluminium will always outperform steel on a weight basis; and on the stiffness issue alone it will carry the day,” said Alcoa’s chief technology

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?

We would agree with this statement. The trend for ever smaller vehicles is growing.

Even though aluminium can out-perform steel on a weight ratio, the only way to get strength into a compact vehicle is by the using steel. There is not enough space to fit sufficient aluminium into the available area.

8. “Within the next 15 years or so there could be a nearly even split between steel, aluminium and carbon fibre content in the average North American-produced light vehicle.” So said Jay Baron, president of the Centre for Automotive Research. Who is closer to the truth – Dick or Jay?

We would still think Dick is closer to the truth. Steel will predominantly be much more popular in the production of forklift trucks, where counterweight is required.

9. In your dealings with steel producers, are you finding that they are looking to companies like COMBILIFT to offer them solutions in terms of energy efficiency and sustainability? If so, what can you offer them?

All the companies we deal with are striving to make their operations more efficient on www.steeltimesint.com

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PERSPECTIVES: COMBILIFT

43

a number of levels and energy saving and sustainability feature high on their lists of priorities. When it comes to materials handling, the ability to use forklifts that are capable of multiple tasks, such as the Combilift, allow fleet numbers to be cut, reducing fuel consumption. One Combilift can, for example, replace a sideloader and a counterbalance forklift, but due to its versatility and manoeuvrability fleet numbers can be cut by more than half in many cases. The ability to store more in less space also contributes to energy savings as this avoids the expense of acquiring extra warehouse space and the subsequent running costs. Our trucks also have a proven long life operation and will run for many years, avoiding frequent replacement.

Both analog and digital interfaces are standard - all processing features are integrated into SPOT. No need for any separate processor unit High quality optics allow for measuring small objects at a distance - features a durable sapphire protection window ensuring precise targeting

10. What exhibitions and conferences will COMBILIFT be attending in 2014?

Integrated camera and pulsed high brightness LED make alignment easy and accurate - indicates target size and location using an easily visible pattern

Euroblech will be our biggest steel trade show this year. We have been using this show as a platform for the sector with great success for many years. Metalcon and Fabtech in the USA are important for our business and we participate at many materials handling fairs such as CeMAT in Germany and Manutention in France.

11. COMBILIFT is based in Ireland, but whatâ&#x20AC;&#x2122;s happening steel-wise in the country?

Exports are up from Ireland and based on the feedback from our Irish clients steel consumption is increasing in the country even though there is no actual steel production here.

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

Thankfully I am a heavy sleeper and nothing generally keeps me awake at night. I spend a lot of time travelling around the world to visit customers and dealers and am lucky in that I sleep very well on aircraft and get off more refreshed than when I got on.

However, as we want all of our customers to be 100% satisfied (and, therefore, be referral clients for new business) one thing that does disturb my sleep until a solution is found is a less than satisfied customer.

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

Many commodity prices fluctuate a lot because output is hard to predict - for example grain output varies depending on weather conditions. Steel output is easy to predict. With all the communication technology available today I would like to see global steel output capable of being equated to global demand. t www.steeltimesint.com

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44

HISTORY

Bilbao’s transporter bridge, opened in 1893, was the first to be built and still runs 24/7 today

The transporter bridge

It’s heartening to note that transporter bridges are still with us and that some, like the one crossing the Tees in Middlesborough, UK, is about to complete a £2.6M refurbishment programme. By Tim Smith* ON 1 January 1888 Don Alberto de Palacio was given the task of designing a bridge across the estuary of the river Nervión, which flows through the northern Spanish city of Bilbao. Not only did the bridge have to span 160m, but it also needed to be 50m high to allow the sailing ships of the day to pass.

The answer was the world’s first ‘transporter’ bridge which consists of two massive towers – one on each bank – linked by a large trellis work ‘crossbeam’ suspended between the towers from which a platform (gondola) hangs and can be driven along the beam to cross the river.

Work commenced in 1890 in collaboration with the Frenchman, Ferdinand Amodin, to build the bridge, which was opened in 1893 as the Bazkaia Bridge - in the Basque language - Vizcaya in Spanish, or Biscay in English.

The bridge carried passengers and vehicles for 44 years until the crossbeam was destroyed in 1937 during the Spanish Civil War to prevent enemy forces crossing the river.

Work started to reinstate the crossbeam in 1939 and in 1941 the bridge reopened.

In 1963 a new gondola 15m long and 10m wide was installed and was itself replaced in 1998 by the present gondola which offers a cabin for pedestrians and two lanes of traffic.

Today, the bridge carries vehicles and passengers 24 hours a day and a lift has been installed to allow walkers to ascend to the crossbeam and walk through its trellis work while admiring the magnificent views of the port of Bilbao, including the steelworks, ArcelorMittal Sestao.

In 2006 UNESCO declared the bridge a world heritage site and, incidentally, there are some excellent pictures of the bridge on Google Maps (search Vizcaya bridge).

The transporter bridge idea caught

The Newport transporter bridge opened in 1906 and was built to allow workers access to the Orb steelworks

on and more than 20 of them were constructed over the years, eight of which still survive in whole or part and six are still in working order.

Still working are: Martrou in France; Newport and Middlesborough in UK; and Rendsburg and Osten, near Hamburg, in Germany.

Other locations of transporter bridges still standing, but not working, are at Riachuelo in Buenos Aires and Warrington in UK – the latter being the final bridge to be built and opening in 1916. The remaining bridges were either dismantled or destroyed or, in the case of Duluth, USA, converted into a lifting bridge, or in Rio de Janeiro replaced by a fixed bridge.

A bridge at Bordeaux in France was never completed due to the onset of WWI and the towers were later dismantled.

In the UK, the Newport transporter bridge spans the river Usk to the south of the city. It was built to enable workers at the John Lysaght Orb steelworks – today owned by Cogent Power, a subsidiary of

Tata Steel – to get to work. Opened in 1906, the bridge was designed in France – which by then had already built four such bridges – but the drawings supplied were in metric dimensions which initially caused some confusion since the steel supplied was all in imperial sizes.

The main crossbeam is 197m and the distance between the towers 180m to allow for the suspension of the crossbeam between the towers. The height of the beam above high water is 54m. Each tower uses 282 tonnes of steel, and the crossbeam 548t. The 10x12m gondola and its suspension cables together weigh 36t and the traveller from which these are suspended weighs 16t. The suspension and guy cables for the crossbeam together weigh 199t.

The gondola is driven by two 35 bhp DC electric motors at a maximum speed of 3m/sec.

Middlesborough’s transporter bridge across the river Tees is due to complete a £2.6M refurbishment programme in Autumn 2014. Its crossbeam has two cantilever sections – one from each tower – together 259.3m in length, which makes it the longest span of the surviving bridges. It is 48.7m above the river at high water.

The bridge is now a Grade 2 listed building and in 1993 was awarded the Institution of Mechanical Engineers’ highest honour, The Heritage Plaque for engineering excellence.

The longest span transporter bridge ever built was across the river Mersey in the UK near Widnes. It had a span of 304.7m and ran until 1961. Sadly it was then demolished.

In the Soviet Union, a transporter bridge was built as late as 1955 in Stalingrad (now Volgograd). This is the longest known transporter bridge ever constructed. t

* Consulting editor STI November/December 2014

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E10001­M1­Z50­V1­7600

“Others are experimenting.

We are producing. In endless mode.”

Giovanni Arvedi, inventor of the Arvedi ESP process, trains the next ESP operators in his plant that's operated successfully since start-up in 2009 – implemented with Siemens VAI. siemens-vai.com

Evolution of the ESP process 1992 – Start­up of ISP plant 2004 – ISP caster upgrade by Siemens VAI 2006 – Order for first ESP plant to Siemens VAI 2009 – Start­up of first ESP

After five successful years of operation at the patented ESP plant in Cremona, Italy, the Arvedi ESP technology rollout starts now with the next two installations in China.

At these new plants the operators will undergo compre­ hensive training at the plant in Italy, and Arvedi experts will support a smooth ramp­up to high­quality production in the first year of operation.

Highlights since 2009: • Certified API X70 production • Attested 131.6 kWh/t energy consumption • Only five breakouts per year • 0.1% cobble rate • 98% yield from liquid steel to coil • Thin strip down to 0.8 mm at full width and productivity 2013 – Order for next two ESP plants from Chinese customer

Answers for industry.

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The DIL 805-series quenching and deformation dilatometers provide the most accurate dilatometry measurements over the widest range of heating, cooling, and deformation conditions, allowing for the most sophisticated characterization and optimization of steel processing conditions. The DIL 805 provides critical data for the construction of time-temperature-transformation (TTT), continuouscooling-transformation (CCT), and time-temperaturetransformation after deformation (DTTT) diagrams as well as stress-strain curves. Powerful inductive heating and an innovative helium quench system enable heating rates up to 4000 K/s and quenching rates as high as 2500 K/s to capture the extremes of modern processing conditions.

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DIL 805 Steel Times ad 2014.indd 1

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