NEW ORLEANS U.S. demand
for metallics-based raw materials like pig iron, hot-briquetted
iron (HBI) and direct-reduced iron (DRI) will continue to grow
this year due to more-affordable energy costs and growing steel
demand, according to Frank Griscom, secretary of the
International Iron Metallics Association.
"Looking at the U.S. metallic
imports, we imported about 5.5 million metric tonnes of these
materials in 2010 and that gradually increased to 6 million
tonnes in 2011," Griscom told delegates Wednesday at the
Critical Commodities Conference in New Orleans. "Were
looking for a strong year in 2012 as the flat-products industry
continues to improve."
Griscom highlighted the
importance of metallics-based raw materials, which allow the
creation of higher-grade steel products compared with ferrous
"Ferrous input material used to
make steel materials is broadly grouped under steel scrap or
ore-based metallics," he said. "As a result, ore-based
metallics are often called scrap substitutes. But they are
actually supplements and add value beyond the basic price of
Major international producers of
HBI include Russia, India, Qatar and Venezuela. Mills in India
and Qatar export large amounts of HBI when the markets are
doing well, Griscom said.
However, supply is constrained
by global demand factors such as growing Chinese demand for
imported metallics, the availability of low residual scrap and
the impact of increased domestic demand in Russia.
Venezuela has historically been
the United States major supplier of HBI. But in recent
years those numbers have decreased dramatically due to shifts
in economics and government policy. But that could change in
the near future due to newly reduced regulations, new
investments and government plans to increase production to some
4.5 million tonnes in 2012.
Metallics could gain importance
this year, particularly due to a number of major U.S. steel
mills buying ore-based facilities, Griscom added.
Nucor Corp., Charlotte, N.C., is
constructing a DRI plant in Louisiana. The company said late
last month that construction on the facility, which will have
an annual capacity of some 2.5 million tons when completed in
2013, is progressing (AMM, March 22). Earlier this
year, Severstal North America Inc., Dearborn, Mich., also said
it would conduct a feasibility study on the construction of a
DRI plant in Trinidad and Tobago (AMM, Jan. 11).
"How much of this capacity will
be realized?" Griscom asked. "Will there be enough scrap and
ore to meet the (electric-arc furnace) industry? Only time will