Swedish steelmaker SSAB studies accelerating low-emissions steel supplies

Swedish steelmaker SSAB said Oct. 25 that there is “great interest” from customers for low-emissions steel, while bringing on more supplies will need developments in power transmission, permitting and supportive steel market policies.

SSAB said it continues to study accelerating its offering of commercial low-emissions supplies, currently targeted by 2026, in a quarterly report. The move is contingent on electric arc furnaces (EAFs) being installed at Oxelosund in southern Sweden and at its other Scandinavian sites in the future, the company said.

“We are exploring the prerequisites to convert to fossil-free production earlier than the original plan,” SSAB said. “However, this requires that society can ensure power transmission, effective permit processes and a level playing field within Europe and beyond.”

SSAB brought on Mercedes-Benz in the third quarter, among new partnerships with steel users to demonstrate lower emissions through the steel value chain. Truck and bus manufacturer Volvo Group in Q3 successfully used steel plate rolled at the Oxelosund blast furnace works from hydrogen-based hot-briquetted iron sourced from the HYBRIT pilot plant in Lulea, to demonstrate use in a mining haulage vehicle. SSAB is a partner in HYBRIT, which is using renewable power for electrolysis to produce hydrogen, compared with typical direct reduction iron plants which use natural gas.

Heating cold ferrous scrap and HBI supply has hampered usage rates for steelmaking through the blast furnace’s basic oxygen furnace, while some companies are now trying to optimize use of scrap and HBI with iron ore in the blast furnace to cut down on coke and other fuel emissions.

“SSAB’s fossil-free steel is based on HYBRIT technology, where the coal and coke used in traditional ore-based steelmaking is replaced with fossil free electricity and hydrogen,” it said. “By 2026, SSAB plans to supply the market with fossil-free steel at a commercial scale following the replacement of the blast furnaces in Oxelosund with electric arc furnaces.”

In the meantime, SSAB said the industry’s sustainability can be enhanced by using SSAB’s high-strength steel. In 2021, this overall saving may correspond to 10 million mt/year of CO2 during steel use, split between SSAB EcoUpgraded products with 80% and premium automotive steels with 20%.

SSAB, which relies 100% on use of iron ore pellets rather than sintered ore and lump, saw iron ore purchase pricing double from Q3 2020, and rise further from Q2, as market pellet premiums rose to record levels.

Average iron ore pellet prices in Q3 rose by 9% in US dollar terms compared with Q2, it said. SSAB said it buys pellets from LKAB and Severstal.

SSAB’s coking coal purchasing prices rose 31% on the quarter in in Q3, and by 64% from Q3 2020.

SSAB sourced coking coal from Australia, the US and Canada, usually through annual supply contracts with monthly pricing, the company said in its report.

— Hector Forster