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Global steel production is reliant on coal. Coal is a >> Steel is essential to modern societies: food
direct input in the production of steel – almost production and preparation; water collection,
70% of the steel produced today uses coal. The purification and delivery; healthcare;
remainder is produced using electricity – often transport systems – cars, trains and ships;
generated using affordable and reliable coal. and modern communication systems all
depend on steel.
Steel is a fundamental material for modern life.
The manufacture of steels ultimately delivers the >> Strong population growth and rapid
goods and services that growing economies urbanisation is driving demand for steel – as
demand – healthcare, telecommunications, cities develop, housing, water and electricity
improved agricultural practices, better transport are urgently required and transport and
networks, clean water and access to reliable and communication links have to expand.
affordable energy. Steel is a vital building block for
development – facilitating economic growth and >> Steel is critical in the energy sector – it is
poverty alleviation. used for fuel exploration, production,
electricity generation and various forms of
In Coal & Steel, the World Coal Institute provides supply infrastructure.
an overview of coal’s role in the iron and steel
sector. The report looks at the demand and supply >> Major efficiency gains have been achieved in
of coal and steel, the importance of steel to our the integrated iron and steel sector. Several
daily lives, describes manufacturing processes and innovative solutions are being developed to
considers options to reduce environmental further reduce, manage and control
impacts, including carbon capture and storage. emissions from the process.
Contents
27 FURTHER READING
SECTION 1
Steel Fact Steel is a vital building block for development Much of the demand for steel is being driven by the
Almost all coking coal is – it facilitates economic growth and poverty strong and rapid economic growth of China and
transformed into coke for alleviation and is a major element in improving India. In 2006, economic growth rates in those
use in blast furnaces for the quality of life. countries were 11% and 9% respectively. With a
production of iron for the
population of over 1 billion in India, and almost 1.3
steel alloy.
Coal is an essential input in the production of billion in China, the demand for products and
steel. Steel is a man-made alloy of iron and carbon services has fuelled an almost insatiable demand
– and that carbon usually comes from coal. Almost for steel. China and India together consumed over
70% of the steel produced today relies directly on 445Mt of steel in 2006, around 40% of total
metallurgical coal, also referred to as coking coal. global crude steel consumption. This is set to
The remainder is produced by recycling scrap continue as India is projected to eclipse China in
steel (itself originally produced directly using coal) population size by 2025 and the two countries will
using electricity – often generated using account for around 36% of the global population.
affordable and reliable steam coal.
Rapid urbanisation worldwide is driving demand
Increasing Demand for Steel still further – as cities grow, housing, water and
Over the last 35 years steel production electricity are urgently required. Transport links
worldwide has almost doubled, from less than must be expanded to meet the geographical
600 million tonnes (Mt) in 1970 to around 1.2 growth of urban and peri-urban areas. The
billion tonnes in 2006. The period 2000-2006 availability and reliability of modern
has seen unprecedented growth, with global communication systems also becomes ever
figures rising over 47%. more important as urban economies become
more sophisticated. Around 4.9 billion people
are expected to be urban-dwellers by 2030 -
■ Steel World Coking Coal & Steel Production (Mt) 60% of the world’s population. This will place
■ Coking Coal huge pressure on existing infrastructure and
1400
create significant demand for housing, better
1200
transport systems, communications networks,
1000 energy, sanitation and healthcare.
800
Coal will continue to play a major part in the
600
manufacture of the world’s steel for the
400 foreseeable future. The well-supplied world market
means that metallurgical coal can be delivered
200
worldwide, facilitating the manufacture of steels
0 which will ultimately deliver the goods and services
81
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20 5
06
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Steel Production
SECTION 1 END
6 World Coal Institute
SECTION 2
Definition Coking coal has particular physical properties Coking Coal Demand & Supply
Coking coal is defined as that on heating to over 1000°C (in the absence of World demand for coking coal increased from
hard coal with a quality that air) causes the coal to soften, liquefy, then 635Mt in 2005 to 706Mt in 2006. China, India,
allows the production of resolidify into hard but porous lumps, known as Japan, Russia and Ukraine together accounted
coke suitable to support a
‘coke’. As a major raw material fed into the blast for around 74% of total global consumption of
blast furnace charge. Coking
coals have a higher carbon
furnace, coking coals must be of high quality to coking coal in 2006. The largest producers of
content than steam coals, support the charge of a blast furnace with as coking coal are China and Australia.
which are mainly used in little degradation as possible, providing high
electricity generation. thermal efficiency and metal reduction. Coking
coals must also be low in sulphur, phosphorus
and alkalis - such as sodium and potassium.
Types of Coal
47% 53%
Thermal Metallurgical
Steam Coal Coking Coal
Top Coking Coal Consumers – 2006e (Mt) Top Coking Coal Exporters – 2006e (Mt)
Top Coking Coal Producers – 2006e (Mt) Top Coking Coal Importers – 2006e (Mt)
Source: IEA
58Mt
Internal Trade
6Mt 3Mt
Internal Trade
30Mt 112Mt
3Mt Internal Trade 39Mt
17Mt
42Mt 18Mt
Internal Trade
71Mt
51Mt
8Mt
Source: ISSB Internal Trade
4Mt
11Mt
Coal & Steel 11
Share of Global Steel Production by Company Consolidation in the Iron & Steel Sector
Top 15 Steel Producers account for 35% of World Steel Production Consolidation in the iron and steel sector is
Arcelor/Mittal
a recent trend, with several mergers within
Severstahl the generally fragmented industry. The largest
Tangshan
Wuhan steel company, ArcelorMittal, now accounts
Anshan for around 10% of the total market. In 2006
Nucor
Riva the top five steel producers accounted for
796Mt Tata/Corus 444Mt 19% of world production. Consolidation has
US Steel
Shandong been occurring in most regions (except China)
Baosteel and is likely to continue, with moves to
JFE
Posco maintain basic production near to raw
Nippon
Source: ISSB Evraz
materials but increasingly producing finished
steel near to the major consuming markets.
2006(e) 2005
PR China 49 26
Japan 34 32
Russia 31 30
EU25 30 31
Ukraine 30 27
Source: ISSB
e: estimated
2006(e) 2005
USA 40 29
EU25 39 27
South Korea 22 18
PR China 19 27
Turkey 12 10
Source: ISSB
e: estimated
12 World Coal Institute
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
19
19
19
19
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19
19
19
19
19
20
20
20
20
20
20
20
Imports
Exports
combined. With a real GDP growth rate
of around 11% during 2006, China has
Steel Production – China (Mt) experienced a continuous increase in the
Source: IISI demand and use of steel.
450
150
increasingly in inland cities. Infrastructure
100 projects, electromechanical producers, ships,
50 machines, together with preparations for the
0
2008 Olympic Games in Beijing, have all
96
98
00
02
04
97
99
01
03
05
06
19
19
20
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20
20
20
Car consumption in China is also starting to China surpassed Japan, Russia, the Ukraine
significantly increase. In 2006, China surpassed and the EU25 to become the world's biggest
Japan to become the world’s second largest steel exporting country in 2006. With
market for new vehicles after the US. The exports of 49Mt, China is exporting at the
changes in car consumption coincide with rate of almost 1Mt a week. 2006 exports
the large investment made by the Chinese were a 91% increase over the previous year.
government in the highway network. By the Chinese steel imports fell to 19Mt, down
end of 2006, it had approximately 45,000km 30% on 2005.
and the highway network is set to expand to
65,000km by 2010 and 120,000km by 2030. Coking Coal
China is the world’s largest producer and
China’s Three Gorges Dam is a major consumer of coking coal, at 323Mt and
construction project and will be the largest 327Mt respectively. China is also the fifth
hydroelectric power station in the world when largest importer of coking coal and seventh
it becomes fully operational in 2009. The largest exporter of coking coal.
reservoir is over 600km long and can hold
39.3km3 of water. Steel has been a vital China is one of the world’s biggest coke
material, with around 463,000t of steel exporters, accounting for 45% of world coke
utilised in its construction. exports in 2005, at almost 13Mt.
Steel Market
In 2006, with a total production of 423Mt, Top Iron & Steel Companies – 2006 (Mt)
China’s steel output was over three times that
of the next largest producer, Japan, and Baosteel 23
accounted for 34% of global steel production. Tangshan 19
Chinese steel production in 2006 was over Anshan 15
18% higher than in 2005. Jiangsu Shagang 15
Wuhan 14
Source: IISI
SECTION 2 END
14 World Coal Institute
SECTION 3
Steel Fact There are thousands of types of steel – each Buildings & Construction
75% of the steels used providing different characteristics due to the Steel is a universal building material due to
today did not exist specific combination of elements in the alloy. its strength, durability, versatility and
20 years ago. Adding other elements to the hot metal affordability. The superstructures of
provides a wide range of alloy steels, such as skyscrapers, bridges, high-rise apartments
stainless steel. The most common is carbon and commercial buildings and offices are
steel, which is composed simply of iron built with steel.
and carbon.
Society’s need for housing is great and
Changing the amount of carbon in the steel increasing. Around 1.1 billion people live in
affects the hardness of the alloy, enabling a inadequate housing conditions in urban areas
variety of uses. Low-carbon steel (up to 0.35% alone. Some 21 million new housing units are
carbon) is commonly used for drinks or food needed each year to meet present growth in
cans but can also be converted into a wide developing countries. Steel is an ideal
range of alloys, such as engineering steels and material to help meet this growing need – it is
tool steels. Medium and high carbon steels long-lasting, versatile, earthquake resistant
(0.35%-over 1%) may also be used for a wide and 100% recyclable.
range of applications, including surgical steels.
Stainless steels contain a minimum of 10%
chromium, often combined with nickel, to
resist corrosion.
Ships are mainly constructed from hot rolled DoCoMo Telecommunications Tower
utilises a steel design.
steel plates which are then cut to size for
Photo courtesy of Arup Japan
particular parts of the ship such as the hull, the Client: NTT DoCoMo Kansai, Inc.
internal framing of holds and rooms, decks, Architect: NTT Facilities, Inc. &
chimneys and superstructure. Arup Japan
SECTION 3 END
18 World Coal Institute
Viaduc de Millau, France. The largest pylon is 343 metres high, taller than the Eiffel
Tower. Steel was essential to the construction of the bridge. Photo courtesy of
CEVM/Foster + Partners/D. Jamme
Coal & Steel 19
SECTION 4
Definition Carbon dioxide is formed during the chemical generating the electricity for Electric Arc
Pulverised Coal Injection reactions in the production process as well as Furnaces, which would have a significant
(PCI) allows coal to be from the energy used. Major efficiency gains impact on indirect emissions from steel
directly injected into the have been achieved in the integrated iron and production, reducing emissions over the
blast furnace to provide the
steel sector over the last 50 years. State-of- full life cycle.
chemical reaction agents to
convert iron ore to pig iron.
the-art integrated processes are at, or very
PCI allows steam coal to near, their thermodynamic limits. This means The CCS reduction potential for the iron
be used in the steel that while efficiency improvements can be and steel sector has been estimated to
production process. made at older plants, there may be no further be approximately 0.5-1.5 Gigatonnes of
scope to directly reduce CO2 emissions CO2 per year.
from today’s best practice plants using the
same approach. New Processes
Further technological change and innovation
Several innovative solutions are being can bring about a reduction in sectoral
developed to further reduce, manage and emissions. Increased use of pulverised coal
control emissions from the process, while injection (PCI) reduces the need for coke,
carbon capture and storage (CCS) could avoiding emissions and efficiency losses from
reduce sector CO2 emissions to the the coking process. New smelt reduction
atmosphere to near zero. processes are gradually gaining market share,
and the use of Direct Reduced Iron (DRI) has
Carbon Capture & Storage significantly increased during the last 30 years.
CCS is most cost-effective when applied In absolute terms, steel scrap use keeps
to large, stationary sources of CO2 – such growing, although its market share may be
as steelworks and power stations. CSS steady or even in decline.
technologies offer the possibility of reducing
carbon dioxide emissions to the atmosphere to Pulverised Coal Injection
near zero without major changes to the basic The injection of pulverised coal into the blast
industrial process of steel making. CCS furnace is an established technology, growing
would allow emissions of CO2 to be captured in use (see Annex for technical description).
from the iron and steel making process and Significant interest has also been shown in the
permanently stored in geological formations – injection of plastic wastes into blast furnace
preventing them from entering the operations as a substitute for coke and coal.
atmosphere (see diagram on page 21). Hydrogen from the plastics can be used as fuel
CCS can also be used at the power stations for the process.
20 World Coal Institute
The two main steel production processes utilised are the Basic Oxygen Furnace and Electric Arc
Furnace. Post-production processes provide the raw outputs which may then be further
transformed to their final end use, such as the production of wire at this facility.
Photo courtesy of Stahl-Zentrum
Coal & Steel 23
ANNEX
Post-production processes – casting and rolling Commercial ores usually have an iron content of
– provide the raw outputs which may then be at least 58%. Iron ore is mined in around 50
further transformed in manufacturing processes countries – the largest producers are Australia,
worldwide for their final end use. Brazil and China. The seven largest producers
account for about 75% of world production.
Raw Materials Around 98% of iron ore is used in steel making.
Steel is an alloy based primarily on iron.
As iron almost always occurs as iron oxides in Coking coal is converted to coke by driving
the earth’s crust, the ores must be converted, off impurities to leave almost pure carbon.
or ‘reduced’ using carbon. The primary source The physical properties of coking coal cause
of this carbon is coking coal. the coal to soften, liquefy and then resolidify
into hard but porous lumps when heated in
the absence of air.
Oxygen inlet
Molten Steel
Steel Fact Pulverised Coal Injection Blast furnaces have two or three tap holes
The average Blast Furnace – Pulverised Coal Injection technology has been and the hot metal and slag are ‘tapped’ off
Basic Oxygen Furnace developed whereby coal is injected directly into regularly as they accumulate in the base or
integrated system uses the blast furnace. The pulverised fuel provides hearth of the BF. The hot metal drains into a
around 0.63 tonnes of coke
the process heat in the blast furnace to enable vessel known as a ladle car, which is used to
to produce 1 tonne of steel.
gasification of the coke. A secondary function is transport it to the BOF plant.
to provide some of the carbon for the reduction
process. A wider range of coals can be used in Iron Making - Direct Reduction of Iron
Definition PCI, including steam coal which has a lower An alternative to iron making through BF is the
Fluxes – minerals, such as carbon content than coking coal. This method Direct Reduced Iron process (DRI used with
limestone, which are used to has a number of advantages, including reducing EAF). The share of steel produced from DRI has
collect impurities. overall costs and prolonging the life of existing increased during the past three decades and
coke batteries. today it accounts for some 5% of global iron
metal supply.
Iron Making - Blast Furnace
During the iron making process, a blast Direct reduced iron is produced via an innovative
furnace is fed with the iron ore, coke and iron making process. While the blast furnace is a
small quantities of fluxes. Air which is heated smelter that melts everything and enables the
to about 1200°C is blown into the furnace removal of non-ferrous material such as slag,
through nozzles called tuyeres in the lower direct reduction of iron is a reduction process
section. The air causes the coke to gasify, that does not remove this material. It must
producing carbon monoxide/carbon dioxide therefore use much ‘cleaner’ ore, otherwise it
which reacts with the iron ore, as well as heat would be charged in the electric arc furnace and
to melt the iron. would have to be melted there. The process
Coal & Steel 25
368
132
71
102
75
21
56
Former Soviet Union
Total Output: 121
55
Europe
North America Total Output: 234
Total Output: 131 2 13
PR China
Middle East Total Output: 423
Total Output: 15
21 22
8 11
India 130
TOTAL WORLD: Total Output: 43
Africa
Output: 1211* Total Output: 19
Oxygen: 813
27
Electric: 398 81
18
Central & South America
Total Output: 46
Source: IISI
*A small percentage of steel is also produced using open hearth & other methods (particularly in FSU)
involves the use of pellets of iron ore ‘fines’ to or stranded gas fields, or with significant
produce direct reduced iron of high quality - reserves of steam coal. DRI therefore allows
composed of 97% pure iron compared with the indigenous resources to be utilised.
93% for pig iron from a blast furnace.
Some of the biggest producers of DRI include
It can then be used in combination with an India, Venezuela, Mexico and Iran. India, for
Electric Arc Furnace to produce steel (DRI example, has limited reserves of coking coal and
products are rarely used in the integrated therefore utilises its large reserves of steam
route). The reduction process takes place coal to reduce iron ore using DRI technology.
using natural gas or coal - DRI is often used in
countries with large domestic reserves of gas
26 World Coal Institute
Steel Making – Basic Oxygen Furnace Over the last 30 years there has been a
The most commonly applied process for steel significant increase in the use of electric arc
making is the integrated steel making furnaces, which now account for some 32% of
process via Blast Furnace-Basic total steel production (see Figure 2 on page 24).
Oxygen Furnace (see Figure 1 on page 24).
The Electric Arc Furnace operates on the basis
In the basic oxygen furnace, the iron is combined of an electrical charge between two electrodes
with varying amounts of steel scrap (less than providing the heat for the process. The power is
30%) and small amounts of flux. A lance is supplied through the electrodes placed in the
introduced in the vessel and blows 99% pure furnace, which produce an arc of electricity
oxygen causing the temperature to rise to through the scrap steel (around 35 million
1700°C. The scrap melts, impurities are oxidised, watts), which raises the temperature to 1600˚C,
and the carbon content is reduced by 90%, melting the scrap. Any impurities may be
resulting in liquid steel. removed through the use of fluxes and draining
off slag through the tap hole.
Other processes can follow – secondary steel
making processes – where the properties of EAF cannot produce the wide range of steels
steel are determined by the addition of other that BF-BOF is able to because the use of
elements, such as boron, chromium, scrap and DRI limits the removal of impurities
molybdenum, amongst others, ensuring the at EAF plants and the quality control that can
exact specification can be met. be achieved.
Optimal operation of the blast furnace Electric Arc Furnaces do not use coal as a raw
demands the highest quality and consistent material, but many are reliant on the electricity
raw materials – the carbon content of coke generated by coal-fired power plant elsewhere
therefore plays a crucial role in terms of its in the grid.
effect in the furnace and on the hot metal
quality. A blast furnace fed with high quality Operations using the EAF system are often
coke requires less coke input, results in known as mini-mills, although EAF units are also
higher quality hot metal and better common in integrated plants. They have a
productivity. Overall costs may be lower, as flexibility advantage over the BF-BOF integrated
fewer impurities in the coke mean smaller steelmaking route as the furnace can be
amounts of flux must be used. switched on and off as desired, following market
demand for products. Mini-mills are more energy
Steel Making – Electric Arc Furnace efficient on site, but overall impacts need to be
The Electric Arc Furnace process does not considered on a full life-cycle basis.
involve iron making through a Blast Furnace.
Instead, it reuses existing steel, avoiding the
need for raw materials and their processing. The
furnace is charged with steel scrap, it can also
include some direct reduced iron or pig iron for
chemical balance.
ANNEX END
Coal & Steel 27
FURTHER READING
>> Arup Japan >> The Economist, “Cars in China”, June 2005
www.arup.com/japan
>> Eurofer
>> Association of European Producers of Steel www.eurofer.org
for Packaging
www.apeal.org >> Fédération Française de l’Acier
www.ffacier.org
>> Association for Iron & Steel Technology
www.aist.org >> Foster + Partners
www.fosterandpartners.com
>> ArcelorMittal
www.arcelormittal.com >> IEA, Coal Information 2006 & 2007
OECD/IEA, Paris
>> Balfour Beatty Power Networks
www.bbpnl.com >> IEA, Technological Potentials for CO2 Emission
Reduction in the Global Iron & Steel Industry,
>> BBC, “Urban Growth – Facts and Figures”, OECD/IEA, 2006, Paris
June 2006
>> IEA, World Energy Outlook 2006,
>> BHP Billiton Illawara Coal OECD/IEA, Paris
http://illawarracoal.bhpbilliton.com
>> IEA/CIAB, Coal in the Energy Supply of China,
>> BHP Billiton Mitsubishi Alliance OECD/IEA, 1999, Paris
www.bmacoal.com
>> Iron & Steel Statistics Bureau
>> BlueScope Steel www.issb.co.uk
www.bluescopesteel.com
>> International Iron &
>> Building Big Steel Institute (IISI)
www.pbs.org/wgbh/buildingbig www.worldsteel.org
>> Stahl Zentrum For more information on coal and the activities
www.stahl-online.de of the World Coal Institute – including copies of
all WCI publications - please visit our website:
>> Steel Construction www.worldcoal.org
www-elconstruction.org
World Coal Institute
>> Steel On the Net 22 The Quadrant
www.steelonthenet.com Richmond TW9 1BP
United Kingdom
>> Steel University
t: +44 (0) 20 8940 0477
www.steeluniversity.org
f: +44 (0) 20 8940 9624
>> Structurae info@worldcoal.org
www.structurae.de www.worldcoal.org
>> UN DESA, World Population Prospects – This publication may be reproduced in part for
the 2006 Revision, United Nations, New York educational or non-profit purposes without
special permission from the copyright holder,
>> UN DESA, World Urbanization Prospects – provided acknowledgement of the source is
the 2005 revision, United Nations, New York made. The World Coal Institute would
appreciate receiving a copy of any publication
>> US Energy Information Administration that uses this publication as a source. No use of
www.eia.doe.gov this publication may be made for resale or for
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>> Viaduc de Millau without prior permission in writing from the
www.viaducdemillau.com World Coal Institute.
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First published in the UK in August 2007
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Copyright © 2007 World Coal Institute
>> WCI, Coal: Secure Energy, World Coal
Institute, 2005, London
The World Coal Institute promotes: >> Improve understanding of the importance
of coal as the single largest source of fuel
>> Coal as a strategic resource, essential for a for electricity generation, and its vital role
modern quality of life, a key contributor to in other industries – including steel
sustainable development and an essential production, cement manufacturing,
element in enhanced energy security. chemicals and liquid fuels.