Why is this important to us?
Every aspect of the way resources are used is now under question – from manufacture to product design to how goods and services are 'owned'. Global commentators are predicting a shift towards a new type of economy in which everything is recycled or reused, and no raw materials or energy resources are wasted.
So when we talk about efficiency, we mean it in the widest sense. We have a social, environmental and commercial responsibility to use resources efficiently, reducing our impacts and our raw material costs. In today's world, the expectation is that industry reduces its landfill to zero – so we aim to ensure that the resources we do utilise are put to the best possible use, taking advantage of the steel-making processes to generate or reuse as many valuable by-products as we can.
The commercial imperative
What kind of challenges do we face?
While steel is infinitely recyclable and is recycled at a global average rate of 87%, our challenge is to increase the supply of scrap. Today, global steel demand is three times higher than what global scrap supplies can meet. Research tells us that it not until the latter part of the century will global scrap availability enable most new steel to made from old. Until then, iron ore will continue to be the main raw material used in steel production.
We also face the challenge that steel scrap contains certain impurities – mainly copper. As long as steel demand outstrips scrap supply and new steel is needed, this isn't a problem. It means that scrap is better suited for making construction steel, which can accommodate these impurities, and less suited to the higher grades of steel used in automotive and home appliances. So there's still a significant need for primary steel made from iron ore.
The next challenge is to make use of our by-products – slag, sludge, dust, process gases, heat and steam. For each tonne of steel we make, we also produce 0.6 tonnes of residues (BF & EAF). We find markets for many of these by-products, and recycle our process gases too – but we haven't yet found a use for all of them, so there's more to do.
What do we need to do?
We need to continue to develop our production processes for more efficient resource use. In terms of scrap, this means working more with stakeholders to drive up recycling rates around the world until no steel ever goes to landfill. It also means working with the steel industry to develop cost-effective ways to clean scrap supplies from contamination, for example from copper.
In relation to our residues, we need to continue to make our processes more efficient and reduce the amount of residues we produce. We need to find ways to increase our internal recycling rate. And where we can't use the residues ourselves we need to further develop markets to use our by-products – such as the cement, aggregate, agricultural and glass industries. We need to work more extensively with policymakers to ensure that the products that use our by-products are uniformly recognised and incentivised. And we need to roll out best available techniques to increase the recycling rate of our process gases; and continue to develop breakthrough technology to capture the remaining elements for use in other industries so that we create zero landfill waste.
What is the potential to create value?
Steel plants are also recycling facilities – because scrap steel is an important input in the steel-making process. This makes us one of the world's largest recyclers. Our track record in reusing by-products wherever possible, sharing them with neighbouring industries to avoid waste, and developing the potential for more reuse, has made us a valuable industrial and municipal partner.
We see opportunities in the business models emerging from our innovation programmes, which are inspired by more circular economy thinking. Rather than simply selling our slag to the cement industry, for example, we now have a joint venture with Ecocem and produce a cement substitute at two of our steel mills. We have industrial pilots to transform our waste gases into products for other industries – creating potential new revenue streams.
And we're now looking at the potential to use waste from other industries in our steelmaking – for example, to replace some of the coal and coke we use to chemically reduce iron ore. We've had success with tyres in our electric arc furnaces and are now trialling other waste streams in blast furnaces.
Developments like these take us beyond the traditional recycling of steel scrap – which we've done for decades – and could have profound implications for the ways in which we create value.