Steel is an alloy that constitutes iron as the basic metal and contains other basic elements in small quantities. These elements include 2% silicon, 1% manganese, and small quantities silicon, phosphorus, sulfur and oxygen. Steel is largely required in the infrastructure development related purposes mainly construction and also for mechanical uses. The alloy possesses characteristics like hardness, strength, durability, malleability, elasticity etc that makes it apt for the above said uses. The carbon content present in steel acts as a hardening agent, which makes it even stronger than iron and vastly adaptable.

Steel is classified into around 2000 grades depending upon the metal content present in it. The most commonly produced category is mild steel ingot that has a low quantity of carbon at around 0.3% and even lesser manganese.

Overview

Steel has been the key material with which the world has reached at this developed position. All the engineering machines, mechanical tools and most importantly building and construction structures like bars, rods, channels, wires, angles etc are made of steel for its feature being hard and adaptable. Earlier when the alloy of steel was not discovered, iron was used for the said purposes but iron is usually prone to rust and is not so strong. Steel has a variety of grades i.e. above 2000 but is mainly categorized in divisions – steel flat and steel long, depending on the shape of steel manufactured. Steel flat includes steel products in flat, plate, sheet or strip shapes. The plate shaped steel products are usually 10 to 200 mm and thin rolled strip products are of 1 to 10 mm in dimension. Steel flat is mostly used in construction, shipbuilding, pipes and boiler applications. Steel long category includes steel products in long, bar or rod shape like reinforced rods made from sponge iron. The steel long products are required to produce concrete, blocks, bars, tools, gears and engineering products.

Steel is highly a wanted alloy over the world. All the countries need steel for the infrastructural development and overall growth. The production of raw steel in the world accounts up to a staggering 950 million tons of which the maximum share is contributed by China. It produces around 220 million tons of steel annually. The trend of steel production has risen sharply and is still in the up trend. Extraction of steel from its ore involves relatively lower cost of production as compared to other metals like aluminium as the energy needed to produce steel is just 25% of what is required in the extraction of aluminium. Also the rate of production of steel is too high and that is clear from the fact that steel production is 20 times higher as compared to the total production of all the non-ferrous metals!

The consumption of steel is also rising in all the countries through out the world. It is expected to rise with a rate of approximately 10% in the near the future. The world ‘s total steel consumption figure stood at 819 million tons in the year 2003, china again being the dominant country in this consumer’s list. The country consumes all its domestic steel production and even have to import some quantity also. The list of major steel consumer countries is given below

• China

• European Union

• Japan

• Australia

• New Zealand

• United Arab Emirates

• Argentina

• Brazil

The world steel trade figures were 262 million tons in the year 2004. The countries that were the major exporters and dominant players of steel in that year with their respective export figures were

• Japan (34.8 million tons)

• European Union (31.8 million tons)

• Russia (30.4 million tons)

• Ukraine (28.2 million tons)

• China (20 million tons)

Japan has ever been the largest exporter of steel as the largest producer of steel i.e. China has a huge domestic demand also. Only recently china has been added to the net steel exporter’s list, as it is also the largest importer of the product. The other major countries including China that import steel along with their import figures are

• China (33.2 million tons)

• United States of America (32.8 million tons)

• European Union (30.8 million tons)

• South Korea (17.7 million tons)

Steel production rate is very high as compared to the extraction rate of other metals. The production figure of steel in the world is around 950 million tons per annum. The major steel producing countries of the world are

• China

• Japan

• United States
• Russia
• South Korea
• Germany
• India
• Ukraine
• Brazil
• Italy
• Turkey
• France
• Taiwan
• Spain
• Mexico
• Canada
• United Kingdom

China leads the list with an annual production of above 220 million tons contributing to around 30% share to the world production. Japan and USA follows China in the list with 110 million tons and 90 million tons of production. These three countries constitute around 50% of the world production. The production is rising each year with a production rate of 6 to 7%.

Production of steel in India

India is not among the major players of steel in the world. But even though, it produces a significant quantity of steel. The annual production of steel in India remains around 40 million tons and the country ranks 7th in the world production list. The production of steel in India has been given into the hands of private sector since 1991-92. Mainly mild steel ingots are produced in India, their production summing up to around 5 million tons. The main states that are indulged in the production of mild steel ingots are

• Chattisgarh

• Uttar Pradesh

• West Bengal

• Orissa

• Jharkhand

• Rajasthan

• Tamil Nadu

• Punjab

• Maharashtra

• Goa

India knew the process of making steel from iron from the time when it was invented. But the country doesn’t have a reputation of a major player in the world steel market. Earlier, at time when India got independent, there was no such sector like iron and steel to meet the domestic requirements. When the sector was set up, the basic objective of that was to fulfill the demand of the country. But with time it also started exports of steel from India.

Regarding the production and consumption scenario, India stands 7th in the world production list with a production of around 40 million tons per year. Earlier the production of steel in India was in the hands of the government and the licensed companies. But in the year 1991-92, it was delicensed and decontrolled. From then onwards, the private companies directed towards this field and currently, the major companies, which are indulged in, the productions of steel in India are

• Steel Authority of India (SAIL)
• Rashtriya Ispat Nigam Ltd (RINL)
• Tata Sons Ltd (TSL)

Production of mild steel ingots in India is around 5 million tons. The consumption of steel in India figures around 30 million tons. The rate of consumption has increased in the recent times significantly. But luckily, after liberalization there have been no shortages of iron and steel observed in the country. And this factor enables India to export some of its steel to other importing nations. Steel can be freely imported and exported in India. The export of finished steel from India in 2004 was 4.831 million tons. The biggest market for raw Indian steel is China whereby the largest market of steel articles is USA. When, in any year, the production of this alloy in India falls short, the country has to rely on imports. Indian imports have been hovering around 1.5 million tons annually. The trend of imports of steel in India has increased as compared to the past figures.

Market influencing factors

• Economical health and status
• Domestic demand and supply
• Interference of government and other associations regarding price fixation
• Import duties
• Other economic activities
• Other factors like power tariff, freight rates, coal prices.

Steel is traded at the Indian commodity exchanges like National Commodity & Derivatives Exchange ltd and Multi Commodity Exchange of India ltd.