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A study by the World Economic Forum in collaboration with the Boston Consulting Group says mining and metals companies should prepare for fundamental shifts in the industry over the coming decades.
The report called Mining and Metals in a Sustainable World 2050 argues that societal pressure to act more sustainably is growing, and technological advances are creating new possibilities:
“For the mining and metal sector, the challenges are fundamental: these companies are extractors and users of finite mineral resources, and they face significant demands and expectations regarding sustainability from across the value chain and from various stakeholder groups.”
Steel makes up nearly half of the $2 trillion mining and metals supply chain and “provides an excellent proxy for understanding the implications of these changes for the mining and metal industry as a whole.”
Recycling of steel is also more advanced than many other metals – 85% of discarded steel is reused, although only 39% of steel production input is recycled scrap.
The authors envisage two scenarios. The first is a continuation of current trends in steelmaking infrastructure, recycling rates and scrap feed. The second predicts “waves of regulation in Europe, the U.S., and China to mandate increased recycling in the steel production process.”
SEE ALSO: Iron ore miners have new price competition: Chinese scrap
Domestic scrap prices have fallen below the cost for Chinese coastal mills to produce pig iron.
Such changes would happen only if economically feasible—that is, if prices for secondary (recycled) material become more attractive relative to primary extracted material, according to the report
Regulation will support the process and affect prices leading to scrap fed into 25% of blast furnaces and almost all electric arc plants.
The report concludes that even in the more constant first scenario, roughly half of the projected 2.8 billion tonnes of total global steel production in 2050 will rely on recycled scrap.
In the second scenario scrap will constitute close to 70% of the 2050 global total supplanting 650 million tonnes of iron ore and 350 million tonnes of met coal as primary steel production increase only marginally over today’s levels:
Source: BCG, WEF
Image by junrong / Shutterstock.com
Comments
Altaf
We have to see the bigger picture. Steel making industry is not there to support jobs in mining. Steel making is the alpha thing. Every thing else has to support it, including iron ore, met coal etc.
Using scrap steel is more environmentally beneficial and uses less energy. Steel like Aluminum and other metals once made can be reused infinitely.
If because of better practices scrap use goes up and if it cuts into mining more ore, its a positive.