Carbon Steel and Alloy Steel

Main Objective of Research:

To determine the market attractiveness of Carbon Alloy and Alloy steel
Market.

Carbon Steel:
Carbon steel is a steel alloy consisting of iron and carbon. Other elements
are allowed to be present in smaller quantities but they should not affect the
actual properties of steel. They are manganese, with 1.65% maximum,
silicon, with a 0.60% maximum, and copper, with a 0.60% maximum. Tensile
properties can vary but are usually between 500-800 N/mm.
There are four types of carbon steel depending on its carbon content: Low
Carbon Steel (0.05%-0.30%), Medium Carbon Steel (0.30%-0.59%), High
Carbon Steel (0.6-0.99 %) and Ultra high carbon steel (1.0-2.0 %). Lower
carbon steels are softer and more easily formed and steels with higher
carbon content are harder and stronger, but less ductile and harder to
machine and weld.
Most popular and fast moving carbon steel is EN 8D, EN 8 and EN 9.
The chemical composition of different carbon alloy is as given below:

Chemical

EN 8

EN 8D

EN 9

Carbon
Silicon
Manganese
Sulphur
Phosphoru
s

0.35-0.45%
0.10-0.35%
0.60-1.00%
0.050 Max

0.40-0.45%
0.05-0.35 %
0.70-0.90 %
0.060 Max

0.50-0.60 %
0.05-0.35 %
0.50-0.80 %
0.040 Max

0.050 Max

0.060 Max

0.040 Max

080M40 (EN8) - mechanical properties in "R" condition

Max Stress
Yield Stress
0.2% Proof Stress
Elongation

700-850 n/mm2
465 n/mm2 Min
450 n/mm2 Min
16% Min

They are usually supplied in untreated form. Further metallurgy processes for
its uses are spheroidizing, annealing, normalizing, quenching and mar
tempering.
The ideal shape for the production and sale purpose of carbon steel is round
with diameter ranging from 16-80mm.
Applications: Axles, nut, bolts, shafts, gears, connecting rods, screws and
rollers.
Major competitors of carbon steel in Gujarat are Vivek Steel, Balaram
Steel, Laxcon, VSP (Vizag), Jindal, British Alloys, Shah Alloys, etc.

Alloy Steel:
Alloy steel is a steel that is alloyed with a variety of elements in total
amounts between 1.0% and 50% by weight to improve its mechanical
properties.
Various alloy steel are EN24, EN31, EN19, EN353, 8620, 4140, 20MnCr5,
16MnCr5, etc. Most popular and fast moving among them are EN24 and
EN31.
The chemical composition of alloy steels is as given below:

Chemical

EN 24

EN 31

Carbon
Silicon
Manganese
Sulphur
Phosphoru
s
Chromium
Nickel
Molybdenu
m

0.35-0.45%
0.10-0.35%
0.45-0.70%
0.04%

0.9-1.2%
0.1-.35 %
0.30-0.75 %
0.04%

0.04%

0.04%

0.9-1.40%
1.30-1.80%

1.00-1.60%
-

0.2-0.4%

Applications:Connecting rods, shafts, Chain parts, Clutches, Spindles, Screws,

Studs, Pinions, Boring bars, spinning tools, beading Rolls, etc.
Major players are VSP (Vizag), RL, Smita Steel and other Maharashtrian
companies. Most of alloy steel is purchased from Maharashtra.

In alloy steel, payment cycle is around 2 to 3 months. One has to maintain huge
inventory level. E.g. for sale of 50 tonne of steel, one has to maintain inventory of
500 tonnes. Quality is critical in this industry. Many rejections in order happen due
to non-conformance to Ultrasonic test. However, if quality is maintained, one can
demand huge margin.

Comparison between Carbon and Alloy steel market:

Paramet
ers

Carbon Steel

Quality

Only
Physical
Chemical

Inventory
issues
Market Size

Margin

Payment

Alloy Steel

and In addition to Physical and

Chemical parameter, It should pass
ultrasonic test.
None
Huge inventory of all size ranges.
One has to maintain inventory of
500 tonne for the sale of 50 tonne
According to dealers The market size of alloy steel is
estimation, the market demand based and difficult to
size of Ahmedabad for determine. However if the quality
carbon steel is 4000- of alloy steel is maintained, there is
4500 tonnes per month. definite demand for alloy steel.
Rajkot is a big market of Usually, the demand of alloy steel
alloy
steel
due
to in Gujarat is satisfied by the
presence
of
forging manufacturers of Maharashtra such
industries.
as Smita Steel, RL, etc.
Margin is better than High margin
Mild Steel. (Price range (Price range from 45 to 60 per kg
from Rs. 40-45 per kg.)
depending on quality and size of
material. Sometimes it can go as
high as Rs. 65 per kg.)
Slower than MS
Very slow (Payment Realization
starts
after
minimum
2-2.5
months)

Recommendations:
Considering slow payment cycle, huge inventory level and irregular demand
of alloy steel, carbon steel seems more attractive. Also, we are in MS steel
manufacturing, carbon steel will next forward for us. After a year or two, we
can explore the alloy steel market.