The growth of iron ore exports to China has sparked controversy among miners and steel producers on whether India should ship out its surplus. Now, the Union government has devised a possible solution—adapt Chinese technology in steel making.
While India’s steel production is one tenth China’s, the steel ministry has commissioned a study to explore whether Chinese technology can be used domestically.
And next month, the ministry is organizing a seminar in New Delhi on how best to utilize iron ore fines—the dusty crumbs extracted from lumps.
Representatives of Chinese companies such as China Minmetals Corp., Sinosteel India Pvt. Ltd and Baosteel Group Corp. are expected to present papers at the seminar, according to a ministry official.
“The study has looked at the possibility of using fines as a feedstock by the domestic sector,” said an official, who works at the ministry’s economic research unit. “Fines are mostly exported now, but earlier studies have shown that processed fines used in steel manufacturing increases productivity.”
The so-called shaft technology converts iron ore fines into pellets, which can be directly used in the blast furnace to make steel. Fines, generated during the extracting of iron lumps from the earth’s crust, until recently had little value. But rising ore prices and available conversion technologies today are fuelling interest among domestic companies to utilize fines.
India produced 150 million tonnes (mt) of iron ore last year. Nearly 93.2mt were exported, the bulk of which were fines. About 80% of this was shipped to China.
Fines can be sintered and directly used in blast furnaces to make steel, or, they can be converted into pellets, by washing out impurities and glued into tiny globules with additives, such as limestone and coal.
India used 58mt of fines last year mainly through sintering. Companies such as Steel Authority of India Ltd (Sail), which is the biggest user of fines and consumed 18.7mt of it last year, plan to set up a 1.5mt pellet-making facility for Rs2,500 crore. Apart from Sail, Tata Steel Ltd, Ispat Industries Ltd and Rashtriya Ispat Nigam Ltd sinter fines to make steel at their plants. Companies that currently make steel with pellets include JSW Steel Ltd, Essar Steel Ltd and Kurdremukh Iron Ore & Steel Ltd.
The biggest challenge, according to the official, will be to convince small and medium-sized sponge iron makers to adopt pellet making technology. India is the world’s largest producer of sponge iron, which utilizes special-sized lump ore to generate huge quantities of fines.
Sponge iron and metal scrap are used to produce about half of the country’s steel.