Steel Industry

Steel Industry

                                      Steel is an alloy made by combining iron and other elements, the most common of these being carbon. When carbon is used, its content in the steel is between 0.2% and 2.1% by weight, depending on the grade. Other alloying elements sometimes used are manganese, chromium, vanadium and tungsten. Carbon and other elements act as a hardening agent, preventing dislocations in the iron atom crystal lattice from sliding past one another. Varying the amount of alloying elements and the form of their presence in the steel (solute elements, precipitated phase) controls qualities such as the hardness, ductility, and tensile strength of the resulting steel. Steel with increased carbon content can be made harder and stronger than iron, but such steel is also less ductile than iron.

                   The earliest known production of steel is a piece of ironware excavated from an archaeological site in Anatolia (Kaman-Kalehoyuk) and is about 4,000 years old.  Other ancient steel comes from East Africa, dating back to 1400 BC. In the 4th century BC steel weapons like the Falcata were produced in the Iberian Peninsula, while Noric steel was used by the Roman military.^[  The Chinese of the Warring States (403–221 BC) had quench-hardened steel, while Chinese of the Han Dynasty (202 BC – 220 AD) created steel by melting together wrought iron with cast iron, gaining an ultimate product of a carbon-intermediate steel by the 1st century AD. The Haya people of East Africa invented a type of high-heat blast furnace which allowed them to forge carbon steel at 1,802 °C (3,276 °F) nearly 2,000 years ago

                        The modern iron and steel industry in India owes its origin to the grand vision and perseverance of Jamsetji Nusserwanji Tata. The Tata Iron and Steel Company Limited (Tata Steel) was registered in Bombay on 26th August 1907. The construction of the steel plant was then taken up in earnest with the first stake being driven in February 1908. R.G. Wells, an American with steel plant construction experience took over as the General Manager in 1909. Success came when the first blast furnace was blown-in on 2nd December 1911, and the first ingot rolled on 16th February 1912.

History of the steel industry (1970-current)

 

Material for development

The volume of steel consumed has been the barometer for measuring development and economic progress. Whether it is construction or industrial goods, steel is the basic raw material. Lighter metals and stronger alloys have been developed. Plastics and synthetics have replaced steel in many areas.

Steel is made from ores still found in abundance around the world. Technological developments have brought down the time for transformation from iron ore to steel to within a day. Even after decades of use, it can be sent back to the furnaces as scrap, melted and remade into new qualities of steel. It is the most recycled material in the world. In developed countries, recycling accounts for almost half of the steel produced.

Another major feature is the continuous improvement of steel grades. Half of today’s steel grades were not available ten years ago. Just take the example of the most commonly used steel – rods or bars, used as reinforcement material with cement concrete. It used to be plain bars even in the sixties, then came the ribbed bars, followed by the cold twisted deformed bars and now it is thermo mechanically treated bars. Each development has added to the strength of construction. Older varieties of steel have been improved upon and newer grades introduced. The process continues.

Growth of the industry

Global steel production grew enormously in the 20th century from a mere 28 million tonnes at the beginning of the century to 781 million tonnes at the end.

World Steel Production in the 20th Century

Over the course of the 20th century, production of crude steel has risen at an astounding rate, now fast approaching a production level of 800 million tons per year. Today, it is difficult to imagine a world without steel.

During the 20th century, the consumption of steel increased at an average annual rate of 3.3%. In 1900, the USA was producing 37% of the world’s steel. With post war industrial development in Asia that region now (at the turn of the 20th century) accounts for almost 40%, with Europe (including the former Soviet Union) producing 36% and North America 14.5%.

Steel consumption increases when economies are growing, as governments invest in infrastructure and transport, and build new factories and houses. Economic recession meets with a dip in steel production as such investments falter.

After being in the focus in the developed world for more than a century, attention has now shifted to the developing regions. In the West, steel is referred to as a sunset industry. In the developing countries, the sun is still rising, for most it is only a dawn.

Towards the end of the last century, growth of steel production was in the developing countries such as China, Brazil and India, as well as newly developed South Korea. Steel production and consumption grew steadily in China in the initial years but later it picked up momentum and the closing years of the century saw it racing ahead of the rest of the world. China produced 220.1 million tonnes in 2003, 272.2 million tonnes in 2004 and 349.36 million tonnes in 2005. That is much above the production in 2005 of Japan at 112.47 million tonnes, the USA at 93.90 million tonnes and Russia at 66.15 million tonnes. For details of country-wise steel production see Steel production by country.

Growth potential of the industry

Amongst the other newly steel-producing countries, South Korea has stabilised at around 46-48 million tonnes, and Brazil at around 30 plus million tonnes. This brings the focus of the industry to India. Considering a steel consumption of 300 kg per man per year to be a fair level of economic development, India will have to come up to somewhere around 300 million tonnes, if it is to fulfill its ambitions of being a developed country. That, of course, is a long journey from the present production level of around 50 million tonnes but one must consider its past before coming to a conclusion about its potential. India was producing only around a million tonnes of steel at the time of its independence in 1947. By 1991, when the economy was opened up steel production grew to around 14 million tonnes. Thereafter, it doubled in the next 10 years, and then it is doubling again, maybe over a slightly longer span. Steel Production in India is expected to reach 124 million tons by 2012 and 275 million tons by 2020 which could make it the second largest steel maker.

In the developed countries, the trend is on consolidation of industry. Cross-border mergers have been taking place for several years. The focus is on technological improvements and new products.

Globally, the steel industry became a billion tonne industry in 2004. How much more it will grow will depend primarily on how much more steel is consumed in the developing countries.

Reduction in workforce

Steel is no more the labour-intensive industry it used to be. Earlier, it was often associated with the image of huge work force living in a captive township. All that has changed dramatically. A modern steel plant employs very few people. In South Korea, Posco employs 10,000 people to produce 28 million tonnes. As a rule of thumb, one can put the direct employment potential at 1,000 per million tonnes. It could be less. However, steel being a basic industry, it generates substantial growth of both upstream and downstream facilities. According to some estimates one person-year of employment in the steel industry generates 3.5 person-years of employment elsewhere. Considering all these, total employment generation will be substantial.

The third quarter of the twentieth century witnessed massive growth of the global steel industry. Annual production rose more than three times in 15 years from 1960. In the last quarter of the century, production reached a plateau, rising only by around 100 million tonnes. Increase in production gave way to increases in productivity. See also steel crisis.

During the period 1974 to 1999, the steel industry had drastically reduced employment all around the world. In USA, it was down from 521,000 to 153,000. In Japan, it was down from 459,000 to 208,000. In Germany, it was down from 232,000 to 78,000. In UK, it was down from 197,000 to 31,000. In Brazil, it was down from 118,000 to 59,000. In South Africa, it was down from 100,000 to 54,000. South Korea already had a low figure. It was only 58,000 in 1999. The steel industry had reduced its employment around the world by more than 1,500,000 in 25 years.

Indian Steel Sector

India has emerged as the fourth largest steel producing nation in the world, as per the recent figures release by World Steel Association in April 2011. In 2010, India was the 5th largest producer, after China, Japan, USA and Russia had recorded a growth of 11.3% in steel production as compared to 2009. Overall domestic crude steel production grew at a compounded annual growth rate of 8.4% during 2005-06 to 2009-10. The Indian steel industry accounted for around 5% of the world’s total production in 2010.

Total crude steel production in India for 2010-11 was around 69 million tonnes and it’s expected that the crude steel production in capacity in the country will increase to nearly 110 million tonne by 2012-13. Further, if the proposed expansion plans are implemented as per schedule, India may become the second largest crude steel producer in the world by 2015-16.

The demand for steel in the country is currently growing at the rate of over 8% and it is expected that the demand would grow over by 10% in the next five years. However, the steel intensity in the country remains well below the world levels. Our per capita consumption of steel is around 110 pounds as compared to 330 Pounds for the global average. This indicates that there is a lot of potential for increasing the steel consumption in India.

Immense growth potential in Indian Steel Sector

• Domestic crude steel production grew at a compounded annual growth rate of 8.4% in the last few years.
• Crude steel production capacity of the country is projected to be around 110 million tonne by 2012-13.
• 222 Memorandum of Understandings (MOU) have been signed with various states for planned capacity of around 276 million tonnes by 2019-20.
• Investments at stake are to the tune of $187 billion in the Steel sector.
• Increase in the demand of steel in India is expected to be 14% against the global average of 5-6% due to its strong domestic economy, massive infrastructure needs and expansion of industrial production.
• Demand of steel in the major industries like infrastructure, construction, housing, automotive, steel tubes and pipes, consumer durables, packaging and ground transportation.
• Target for $ 1 trillion of investments in infrastructure during the 12th Five Year Plan.
• Infrastructure projects (like Golden Quadrilateral and Dedicated Freight Corridor) will give boost to the demand in the steel sector in near future.
• Projected New Greenfield & up-gradation of existing Airport shall keep the momentum up.
• Increased demand of specialized steel in hi-tech engineering industries such as power generation, automotive petrochemicals, fertilizers etc

History – Tata Steel

The origins and ascent of Tata Steel, which has culminated into the century long history of an industrial empire, emerge from the illustrious efforts of India's original iron man and the remarkable people who thereafter, have kept the fire burning.

The story of Tata Steel is a century old. And so is the story of steel in India. Etched with the visions and hardships of a single man, the story has flowed through ages to redefine steel in every way. The saga, which started in 1907, completes a century of trust in 2007. Over the years this one company has exposed the various shapes and forms in which steel can be applied for effective utilization. The story of Tata Steel: defines and redefines conventional wisdom in myriad ways. 

The great Iron Pillar, a thousand years older than the Qutab Minar stands as a living testimony to the unmatched skills of ancient Indian metallurgists. They had so perfected the craft of forging that Indian steel was highly sought after. In Marco Polo’s travels there is a reference to andanique, a corruption of the Persian hundawaniy, i.e. Indian steel. Tavernier, the 17th century French traveller, mentions the existence of a steel industry in the “Kingdom of Golconda”. And the Arab Edrisi declared, “The Hindus excel in the manufacture of iron”. For centuries, therefore, steel of remarkably superior quality was being fashioned in India out of primitive furnaces, to be used, for instance, in the preparation of medicine and in the manufacture of arms. It was only in the last century with the advent of the Industrial Revolution that the time- honoured skills of Indian ironsmiths began to die.

The Industrial Revolution in England ushered in an era of unparalleled peace and prosperity. Modern science bore fruit in an unprecedented technological development and industrial progress. This left countries like India, where industrialisation was still in its infancy, feeling slightly dazzled and overwhelmed. The leading Indian intellectuals of the 19th century believed that if India were to keep pace with the world it would have to master the modern scientific methods of the West. In these times was born Jamsetji Nusserwanji Tata. Within his lifetime, Jamsetji was to witness the birth of a revolutionary Indian nationalism that would assist in the emergence of independent India, which he helped to create and whose presence could already be felt when he died in 1904.