Modern steel industry started alongside the development of the first industrial scale process for manufacturing steel in the late 1850s.
It is a basis for the development of a number of industries in the global economic system, since steel is a material that has a wide range of use including metal roofing, steel beams and reinforcing steel in buildings, car, trucks, trains, bridges, railings and railways, art sculptures and jewelry, machines and tools, medicine tools and other everyday use products such as paper clips, scissors and kitchen appliances. (Source: pinoybusines.com, jemkontoret.se)
Steel is an iron alloy, which means that it is primarily composed of iron combined with other alloying metals to produce new materials with unique properties. It is made of iron and carbon and it contains less than 2% carbon, 1% manganese and small amounts of silicon, phosphorus, sulphur and oxygen. (Source: worldsteel.org, bigrentz.com)
Steel making process
Steel can be produced from iron ore or scrap using two different processes: Blast furnace (BF-BOF) or Electric arc furnace (EAF).
The main difference between these processes is the type of raw materials used. For the BF-BOF process these are primarily iron ore, coal, and recycled steel, while the EAF process produces steel using mainly recycled steel (scrap) and electricity. (Source: worldsteel.org)
These two processes are illustrated in the two figures below.
Steel types
There are four main types of steel, these are given in the table below. (Source: weerg.com, bigrentz.com)
Steel type | Description |
Carbon steel | Carbon steel is unique for a notable absence of other elements in its composition. It contains 2% carbon or less by weight and it is made as low carbon steel, medium carbon steel and high carbon steel. |
Stainless steel | Largely used in medical equipment and appliances manufacturing, it contains around 10 to 20% chromium, which is its main alloying element. Stainless steel is resistant to corrosion and very easily molded into various shapes. |
Alloy steel | A mixture of several metals, like nickel, copper, and aluminum. It is used in some car parts, pipelines, ship hulls, and mechanical projects. |
Tool steel | Very commonly used to make metal tools, it is hard and resistant to heat. It is made up of cobalt, molybdenum, and tungsten. |
Steel production
The following figure from World Steel Association’s World Steel in Figure 2021 edition, gives world crude steel production from 1950 to 2020.
According to same source global world’s steel production reached 1878 million tons in 2020 about 0.2% higher than 2019. Whereas, according to Statista, global world’s steel production reached 1864 million metric tons, about 0.9% less than its 1880 million metric tons value in 2019. (Source: worldsteel.org, statista.com)
The following figure details the world’s steel production by region in 2020
Top five highest countries producing steel in 2020 are:
- China: 1064.8 million tons
- India: 100.3 million tons
- Japan: 83.2 million tons
- USA: 72.7 million tons
- Russia: 71.6 million tons (Source: worldsteel.org)
According to the World Steel association, crude steel production in August 2021 was estimated 156.8 million tons (for the 64 countries reporting to the World Steel Association), a 1.4% decrease compared to 2021. (Source: worldsteel.org)
According to the Steel Market Developments Q2 2021:
- In the European Union, steel production decreased by 5.2% over the second half of 2020 year-on-year.
- Amongst the larger steel producers, the contraction was more profound in France (-12.0%), Spain (-11.4%), Poland (-8.6%), Germany (-3.7%) and Italy (-3.4%).
- The United Kingdom steel production increased by 6.0% over the period year-on-year.
- In the “Other Europe” region, steel output increased by 13.7% over the second half of 2020 year-on-year, essentially explained by Turkey’s significant increase in steel production (+16.2%).
- In the CIS region, steel output increased by 3.3% due to an increase in both Russia (+2.8%) and Ukraine (+6.1%).
(Source: Steel Market Developments Q2 2021 report, oecd.org)
Steel industry emissions
The amount of CO2 emissions from steel manufacturing is almost double the amount of steel created. In 2020, on average, every tonne of steel produced led to the emission of 1.851 tonnes of CO2 into the atmosphere. (Source: worldsteel.org)
In 2020, Steel industry was responsible for about 8% of global final energy demand and 7% of energy sector CO2 emissions (including process emissions). (Source: iea.org)
The following figure gives global steel industry CO2 emissions in 2019.
Global steel industry emitted around 3.7 gigaton of CO2 (Gt CO2) emissions in 2019. Of which BF-BOF accounted for 3.16 Gt CO2 and EAF for 0.51 Gt CO2.
Depending on total steel industry emissions given above and the global GHG emissions of 52 Gt CO2-e in 2019 (including non-CO2 GHG emissions) reported in UN Emissions Gap Report 2020, the global steel industry is responsible for around 7% of total global GHG emissions.
Depending on the total steel industry emissions given above and the global CO2 emissions of 33 Gt CO2 in 2019 reported by IEA, the global steel industry is responsible for around 11% of total global CO2 emissions.
(Source: globalefficiencyintel.com)
Steel industry data
According to World Steel Association (worldsteel) Short Range Outlook (SRO) for 2021 and 2022, steel demand will grow by 4.5% in 2021 reaching 1855.4 Mt and will further increase by 2.2% to 1896.4 Mt in 2022. (Source: worldsteel.org)
According to MarketWatch, in 2021 the growth of Steel Market will have significant change from previous year. Over the next five years the Steel Market will register a magnificent spike in CAGR of about 2.9% in terms of revenue, global Market Size will reach 1883880 million USD by 2026. (Source: marketwatch.com)
According to the European Steel in Figures 2021 report, EU exported 7.7 million tons of finished steel products in 2020. About 7.2 Mt were exported to European countries that are not members of EU, 3.6 Mt to north and Central America, 3.3 Mt to Asia, 2.8 Mt to Africa, 0.6 Mt to South America and 0.1 Mt to Oceania. (Source: Steel Market Developments Q2 2021 report, oecd.org)
According to the European Steel in Figures 2021 report, global steelmaking capacity increased in 2020 for the second year in a row reaching 2 452.7 million metric tons in 2020,1.6% higher than 2019’s capacity. (Source: Steel Market Developments Q2 2021 report, oecd.org)
Solutions for decarbonizing steel industry
Steel producers are considering decarbonizing strategies across various options, as given in the table below. (Source: mckinsey.com)
