Despite the potential demand generated by the rapid spread of steam powered railways after 1830, labour-intensive handmade steel was exorbitantly expensive and even steel rails were deemed unaffordable, being made instead of softer wrought iron.
The Basic Oxygen Process, first commercialised in Europe in the early 1950s and later across the world, rapidly replaced earlier methods to achieve 50% of total production by 1970. Electric arc furnaces have since been substituted in many operations, but oxygen remains a vital raw material and over 50% of the industrial oxygen produced globally is consumed in steelmaking.
The mass production of low-cost steel revolutionised the modern world by enabling the manufacture of a vast range of materials, machinery and equipment that were impossible without its strength and durability
Steel consumption was sharply reduced after the third quarter of 2008, when banks around the world throttled the flow of credit finance, halting construction projects and putting a dampener on the demand for machinery and motor vehicles.
Considering that these three sectors typically consume almost 80% of global demand for steel annually, it is hardly surprising that steel producers were forced to cut back output to around of 60% of total output capacity in the final quarter of 2008.
Forecasts published by both MEPS International and the World steel Association suggest that global steel demand in 2010 is likely to exceed the pre-crisis level and possibly hit 1,400 million metric tonnes (mmt). However, recovery from the recession is far from uniform across the globe – the emerging Asian economies, especially China and India, have led the recovery thus far.
The Worldsteel Association forecasts that for 2011 demand in the developed world will be approx. 80% of its demand in 2008, whereas the developing world will consume 124% of its demand for that year.
Over the past decade there has been a dramatic shift in steel production from the western hemisphere towards the east.
While environmentalists might hope that carbon credit motives were at play, the reality is that investments in capacity expansion have been aimed at producing more steel close to those markets with strong growth potential.
Expansion of global production capacity began around 1998, after nearly two decades of negligible growth, and maintained a comfortable gap ahead of demand until 2006 when utilisation peaked at 85%. Since late 2008 capacity growth has outstripped demand to approach a possible 500 mmt by 2012.
During the last decade some 820 mmt of new capacity was commissioned and it is of significance that around 87% of this expansion is located in China, India, the Middle East, South East Asia and the Commonwealth Independent States.
The rest of the world including North America and the European Union (EU) have added a mere 15% to their capacity over the same period and their contribution to total capacity has shrunk from around 66% to little over 40% in 2010.
Given the relatively stagnant market conditions in the developed economies for manufactured goods that drive steel consumption, it is likely that low capacity utilisation ratios will persist in the developed world and could lead to the closure of some higher cost operations.
Comparison of per capita steel consumption indicates the growth potential of these economies – for example, India records only 10% of the consumption in Western Europe and is expected to become the third largest user next year after China and the US.
Strategies for survival
Most governments have accelerated their spending on infrastructure projects in an attempt to boost employment, economic activity and the demand for steel and other raw materials, but inevitably there is greater scope for investments in the underdeveloped regions of the world.
The potential indirect impact of public infrastructure spending could be of the order of 130 mmt of steel over the next year or two, but only a minor portion of this will be felt in regions where underutilisation remains a challenge.
Although the automotive industry is not the largest consuming sector of steel it is seen as a critically important component of demand having used around 150 mmt in 2008. The steel content of an average passenger car is approximately 0.7 tonne and the future expected production rate in North America and the EU is about 15 million vehicles each. This level of production could consume over 20 mmt of steel annually and this is close to the hot metal capacity that is currently idled in the EU.
Despite unemployment and low consumer confidence, the need for mobility and the significant number of people that reach driving age annually are factors that support a recovery in the volume of new vehicles sales. In Western Europe particularly, steel makers are focusing on the continued development of sophisticated grades of steel that allow mass reduction by offering higher strength and other technical advantages, in a bid to maintain market share and profitability.
Applications of industrial gas
The fact that oxidation reactions can be accelerated by substituting pure oxygen for air was what prompted the invention of the Basic Oxygen Process for making steel after WWII.
It may be of interest to note that the development of air separation plants capable of delivering the required volumes of oxygen at an affordable price occurred in the same timeframe.
The industrial gas industry and the steel industry grew rapidly and both benefitted considerably from the development of numerous applications of industrial gases in the production and refining of steel. The gas most strongly associated with steel production and recycling is oxygen and it also enjoys the highest growth potential despite the maturity of its original application in the Basic Oxygen Furnace.
As early as the 1970s, spurred by a major spike in the oil price, commercial trials demonstrated the effectiveness of oxygen enrichment to improve the efficiency of combustion. Oxygen was injected into the burner air supply of reheat and annealing furnaces to boost the natural level by 2-3% resulting in reduced fuel consumption together with increased output. The benefits were often compromised because as retrofit systems, conditions could not be fully optimised.
Oxy-fuel burners were developed that substitute pure oxygen for air and thereby eliminate the nitrogen ‘ballast’ that previously robbed furnaces of energy. Air-fuel systems are inherently inefficient because the 79% nitrogen component increases the flow of gas through the entire combustion system, while contributing nothing useful to the process. Historically, complicated recuperators or regenerators were constructed to minimise the energy wasted.
After the oil price fell back into the $20-$30 per barrel range, the pace of development slowed but the use of oxy-fuel burners increased steadily, driven by fuel savings of up to 50%. Conventional oxy-fuel technology produces a flame that is shorter, hotter and depending on the fuel used, intensely radiant due to blackbody luminosity. Fears of refractory damage and thermal NOx emissions caused by the higher combustion temperatures oxygen produced, precluded oxy-fuel in certain applications.
The so-called flameless oxy-fuel burner now addresses these problems and deliverers an additional saving of 10% fuel consumption and 10% less oxygen requirement for the same level of output. Flameless oxy-fuel systems are designed to entrain hot furnace gas with the oxygen and fuel before combustion is initiated. This results in a larger volume of flame that is barely visible to the human eye, has a highly uniform pattern of heat distribution and high momentum to achieve more homogeneous heating of the steel.
Contrary to previous thought, the lower peak temperature and reduced apparent radiation does not lower the efficiency of heat transfer. Instead the production of thermal NOx is reduced and heat transfer is enhanced by avoiding sharp temperature gradients.
Industrial gas intensity
It is a fact that during the past two decades there has been a steady increase in the intensity of industrial gas demand by the steel industry of 2-4% measured in terms of Nm3/tonne.
The benefits available from most gas applications tend to encourage ongoing extension of the technology to new areas of operation. Flameless oxy-fuel technology is seen as a very exciting growth opportunity, with potential benefits for both the industrial gas business and the steel industry that will further stimulate gas intensity.
Another useful effect of all oxy-fuel applications is a reduction in overall flue gas volume of up to 70%. This implies that after drying, the CO2 gas emitted could reach a concentration exceeding 90%. This facilitates the downstream capture of CO2 for sequestration as envisaged in many proposed climate change mitigation programmes.
Other gases widely used in steelmaking include argon and nitrogen. Argon is completely inert to molten steel and is used for stirring, de-gassing and as a protective atmosphere, with no potential for undesired reactions and no measurable solubility. Nitrogen is used for stirring, refining, shrouding and ladle stirring applications whenever the risk of increased in nitrogen content can be tolerated.
Calibration standard gases and a range of other specialty gases required by process control and quality assurance laboratories form a very important market sector, where the steel industry depends on consistently accurate specifications in order to maintain their quality standards.
gasworld would like to extend its thanks to Dr. Joachim von Schéele, Marketing Manager – Metals & Glass Industries at The Linde Group, for his kind assistance with this article.