Implications Of Higher-Priced Coke For The Steel And Iron Ore Industries

Higher-priced coking coal will probably get a new steel industry’s transition to greener production methods plus the value-based pricing of iron ore. Higher-priced coking coal boosts the price of producing steel via blast furnaces, both in absolute terms and relative to other routes. This typically results in higher steel prices as raw material costs are passed through. It might also accelerate the pin transition in steelmaking as emerging green technologies, for example hydrogen reduction, would be a little more competitive in comparison with established production methods sooner. The necessity to reline or rebuild blast furnaces roughly every ten to 15 years at a price that varies between $100 million and $300 million presents steelmakers with clear decision points, so they will have to appraise the expense of emerging technologies, for example hydrogen-based direct reduced iron, and choose to replace their blast furnaces.

Increased coke prices would also modify the value-based pricing of iron ore. Prices many different qualities of iron ore products rely upon their iron content and chemical (mainly phosphorus, alumina, and silica content) and physical composition (lumps versus fines versus pellets). Lower-quality iron ores want more energy to reduce, resulting in higher coke rates from the blast furnace. Higher coking coal prices boost the cost penalty suffered by steelmakers, resulting in high price penalties for low-grade iron ores. This could affect overall iron ore price dynamics by 50 % different methods, with regards to the degree of total iron ore demand. A single scenario, if total need for iron ore could be met solely with high-grade iron ores, it’s quite possible that benchmark iron ore prices will remain steady. However, price reduced prices for lower-grade ore would increase significantly, potentially pushing producers on this material out from the market. Within an alternative scenario, if low-grade ore can be meet overall demand, both benchmark iron ore prices and discounts could increase significantly, to ensure low-grade producers would stay in industry since the marginal suppliers.

For details about Telf AG Kondrashov go to this popular web site: click now

Leave a Reply